TC Res. No. 1986-090-
El
RESOLUTION NO. 86-9
A RESOLUTION AUTHORIZING A SUPPLEMENT TO THE INDENTURE,
AN AMENDMENT TO THE LOAN AGREEMENT AND AN ASSIGNMENT OF
THE RIGHTS AND OBLIGATIONS UNDER THE LOAN AGREEMENT
RELATING TO THE TOWN OF AVON, COLORADO $9,000,000
INDUSTRIAL DEVELOPMENT REVENUE BONDS (AVON/BEAVER CREEK
HOLIDAY INN HOTEL PROJECT), SERIES 1984.
WHEREAS, the Town of Avon, Colorado- (the "Town") has
heretofore issued its $9,000,000 Industrial Development Revenue
Bonds (Avon/Beaver Creek Holiday Inn Hotel Project),- Series 1984
(the "Bonds") for the purpose of financing a project pursuant to
the Colorado County and Municipality-.Development Revenue Bond Act
constituting-Article 3,-Title 29, Colorado Revised Statutes (the
"Act"), specifically to provide financing for constructing a
hotel facility (the "Project") for Avon Resort Properties, Ltd.,
a Colorado limited partnership (the "Borrower"); and
WHEREAS, pursuant to the Act the Town issued the Bonds
pursuant to an ordinance (the "Bond Ordinance") and an Indenture
of Trust dated as of December 15, 1984 (the "Indenture") and
simultaneously entered into a Loan Agreement dated as of December
15, 1984 (the "Loan Agreement") between itself and the Borrower
pursuant to which the Town agreed to loan the proceeds (the "Loan
Proceeds") from the sale of its Bonds; and
WHEREAS, the Borrower has determined that it is unable-to
complete the Project as proposed and intends to enter- into an
agreement with Avon Wynfield Inn Ltd., a Colorado limited
partnership (".Wynfield") whereby Wynfield proposes to purchase
certain assets of the Borrower and assume the Borrower's rights
and obligations under the Loan Agreement with respect to the Loan
Proceeds from the sale of the Bonds and construct a Wynfield Inn;
and'
WHEREAS, the purpose of the Project was and is and the
effect thereof will be. to enable the Town to promote industry and
develop trade or other economic activity by inducing profit or
non-profit corporations, federal gove_x=ental offices, hospitals
and agricultural, manufacturing, industrial, -commercial, or
business enterprises to locate, expand or remain in this state,
to mitigate the serious threat of extensive unemployment in parts
of the state, to secure and maintain a balance and stable economy
in all parts of the state, or to fur"..her the use of its
agricultural products or natural resources, and to provide more
adecuate facilities for conventions and trade shows, all of which
promote the public health, welfare, safety, convenience and
prosperity; and
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WHEREAS, the Borrower intends to assign (the "Assignment")
its rights and obligations under the Loan Agreement to Wynfield
and Wynfield intends to construct the Project on a parcel of land
within a very short distance from the original proposed site; and
WHEREAS, Wynfield desires to have the approval of the Town
Council before proceeding to cause to be prepared a supplement to
the Indenture, an amendment to the Loan Agreement and the
necessary documents to effect the Assignment;
NOW, THEREFORE, BE IT RESOLVED BY THE TOWN COUNCIL OF THE
TOWN OF AVON, COLORADO:
Section 1. All action not inconsistent with the
provisions of this Resolution heretofore taken by the Town
Council and the officers of the Town directed- toward the
Assignment of the rights and obligations of the Borrower under
the Loan Agreement to Wynfield and the completion of the Project
is hereby ratified, approved and confirmed.
Section 2. The proposed Wynfield Inn is hereby approved
(subject to any other necessary, approvals of the Town Council or
any department of the Town) as the Pro-eat.
Section 3. To defray the cost of construction of the
Project and any incidental expenses incurred in effecting the
Assignment (including any reasonable expenses of the Town), the
Assignment, and supplement to the Indenture are hereby
authorized.'
Section 4. Section 5.2(n) and Section 5.2(o) of the Loan
Agreement-,are to be deleted on the Assignment with the written
approval of the Trustee.
Section 5. The Town Attorney is hereby authorized to
approve ..he form of the'supplement to the Indenture and the Mayor
and Town Clerk or other authorized officer of the Town are hereby
authorized and directed to execute the supplement to the
Indenture and any other document the Town Attorney deems
necessary to effect the Assignment and to affix the Town seal
thereto.
Section 6. All orders, bylaws and resolutions, or parts
thereof, in conflict with this Resolution are hereby repealed.
This repealer shall not be construed to revive any order, bylaw,
or resolution or part thereof, heretofore repealed.
Section 7. If any section, paragraph, clause or
provision of this Resolution shall for any reason be held to be
invalid or unenforceable, the invalidity or unenforceabililty of
such section, paragraph, clause or provision shall not affect any
of the remaining provisions of this Resolution.
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Section 8. This Resolution shall take effect immediately
upon its introduction and passage. It is, however, the desire of
the Town that Wynfield diligently pursue the timely Assignment of
the rights and obligations under the Loan Agreement; to that end,
the Town may reconsider and repeal this Resolution if, upon
review, it is determined that Wynfield is not proceeding in a
diligent and timely fashion.
Section 9. The Town's approval of Assignment is conditioned
upon receipt by the Town, of the opinions of nationally recognized
Bond Counsel, was well as, Counsel of Wynfield, approving the Assignment.
INTRODUCED, READ, AND ADOPTED ON March 11th, 1986, by a
vote of 6 for and 0 against at a regular meet ni g'of the
Town Council at 7:30 p.m. at Avon Municipal Building, 400
Benchmark Road, Avon, Colorado.
(SEAL)
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TOWN OF AVON, COLORADO
C~;,-
Al an R. otting ,Xm, Mayor
P16MENTS ENCLOSED Dated&une -4, 1986
16 'IW
Re, Town of Avon - Revised Supplemental Indenture
The fo0owing enclosures are forwarded for action indicated by check mark below.
For informative purposes - no action necessary.
❑ File ❑ Sign and return ❑ Read and tote ❑
F
LAFF STOWE & HERSKOVM
TO John W. Dunn Professional Corpora on
120 LINCOLN STREET SUITE 1000
L DENVER, COLORADO 80203-21T2
Telephone: (303) 830-2800 -
LAFF STOWE & ASSOCIATES. P.C..
ATTORNEYS AT LAW •
THE CHANCERY. SUITE 1000
1120 LINCOLN STREET
DENVER. COLORADO 80203-2112
TELEPHONE: (303) 830-2800
TELECOPIER: (303) 830-8233
June 4, 1986
Mr. Charles Adomanis
The Philadelphia National Bank
Corporate Trust Administration
1 North 5th Street
Philadelphia, PA 19106,
Re: Town of Avon, Colorado
Supplemental Indenture Revisions
Dear Mr. Adomanis:
SABO 8 STOWE
SAN FRANCISCO. CALIFORNIA
(415) 398-7222
IN ASSOCIATION WITH
SABO 8 GONDEK. P.C.
LOS ANGELES. CALIFORNIA
(8IB) 704-0195
As instructed, I have enclosed the Supplemental- Indenture
containing.'the corrections in the first paragraph following (e)
on page 3 and the fourth paragraph on page 7 (replaced is now
replacing). Due to pagination it was necessary to print the
entire document with the exception of the signature page.
If I can be of further assistance, please call or write.
Very truly yours,
udy C lier
Secretary to Erick D. Stowe
jc
Enclosure
SUPPLEMENTAL INDENTURE
between
TOWN OF AVON, COLORADO
(as Issuer)
and
THE PHILADELPHIA NATIONAL BANK
(as Trustee)
Dated as of March 20, 1986
$9,000,000
INDUSTRIAL DEVELOPMENT REVENUE BONDS
(Avon/Beaver Creek Holiday Inn Hotel Project)
Supplementing and Amending the Indenture
Between the Issuer and the Trustee
Dated as of December 15, 1984
SUPPLEMENTAL INDENTURE
THIS SUPPLEMENTAL INDENTURE made and entered into as'of the
20th day of March,- 1986 (the "Supplemental Indenture") by-and
between the Town of Avon, Colorado (the "Town") and The
Philadelphia National Bank (the "Trustee") amends and supplements
the Indenture dated as of December 15, 1984 (the "Indenture")
between the Issuer and the Trustee concerning $9,000,000
Industrial Development Revenue Bonds (Avon/Beaver Creek Holiday
Inn Hotel Project) (the "Bonds"). All words and phrases defined
in Article I of the Indenture shall, have the same meaning
assigned to them in the Indenture when used herein.
WHEREAS, Section 8.02(i) of the Indenture allows the Trustee
and the Issuer, without the consent of, or notice to, any of the
Bondholders, to enter into supplemental indentures not
inconsistent with the terms. and provisions of the Indenture to
modify, amend, alter or supplement the Indenture in any respect
not iaaterially adverse to the Bondholders in the Trustee's sole
opinion.
WHEREAS, Section 8.02(j) of the Indenture allows the Trustee
and the Issuer, without the consent-of, or notice to, any.of the
Bondholders, to enter into Supplemented Indentures not
inconsistent 'with the terms and provisions of the Indenture for
the purpose of modifying, amending, altering by supplementing the
Indenture in order to obtain the rating of the highest investment
grade.
WHEREAS, in order to obtain the requisite rating of the
Bonds the Issuer and the Trustee find it necessary to modify the.
Indenture by entering into this Supplemental Indenture.
NOW THEREFORE,
supplemented as fol'1i
Section 1. (a)
replacing "Mandatory
Mandatory
13.01(c).
,the Indenture is hereby modified and
Dws:
Article I, Section 1.01 is amended by
Tender" with the following:
Tender: A tender pursuant to Section
(b) Article I, Section 1.10 is amended to include the
following after "Mandatory Tender":
Mandatory Tender Date: a 'tender date described in
Section 13.01(c).
Section 2. (a) Article I, Section 1.01 is amended by
'replacing "Alternate Security" or "Alternative Security" with the
following:
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"Alternate Security" or "Alternative Security" means an
investment agreement, letter of credit, insurance"policy,
guarantee or other credit enhancement device which meets all
of the following criteria: (i) the amount of the
Alternative Security must be sufficient to pay at par all,
principal and interest on the Bonds due at any time up to
and including the mandatory tender date and thereafter as
specified in the notice of mandatory redemption including,
but not limited to the interest and principal due on any
Bonds redeemed in any Alternative Security Mandatory.Tender;
(ii) written confirmation has been received by the Trustee
from a nationally recognized rating agency that after the
furnishing of the Alternative Security a-new credit rating
on the Bonds will be obtained on a going-forward basis of a
level comparable to that maintained on the Bonds immediately
prior to the furnishing of the Alternative Security;-and
(iii) the Trustee and Issuer shall have received from
counsel experienced in"bankruptcy law matters, an Opinion of
Bankruptcy Counsel acceptable to them stating, among other
things, that the Alternative Security and the principal and
interest payments of the Bond secured thereby are not and
will not constitute avoidable preferences under'Section
547(b) of the United States Bankruptcy Code in the event of
a bankruptcy filing by or against the Company of the Issuer.
(b) Article I, Section 1.01 is amended by replacing
"Alternative Security Effective Date"' with the following:
"Alternative Security Effective Date" means the date
set forth in the Notice of Alternative Security Mandatory
Tender provided all of the following conditions are met:
(i) Alternative Security has been posted, and (ii) all Bonds
not excluded from the Alternative Security Mandatory Tender
pursuant to Section 13.02 hereof have been tendered.
Section 3. Article I, Section 1.01 is amended to include
the following additional definition.
"Opinion of Bankruptcy Counsel" means an 'opinion,
provided by nationally recognized counsel experienced in
bankruptcy law matters, that payments to Bondholders
pursuant to Section 13.02 from funds other than those
derived from Bond proceeds, will not constitute avoidable
preferences under Section 547(b) of the United States
Bankruptcy Code, in the event of a bankruptcy filing by or
against the Company or the Issuer.
Section 4. Article I, Section 1.01 is further amended by
replacing subparagraphs (d), (e) and (f) under "Eligible
Investments"with the following:
(d) obligations of corporations or institutions the
unsecured debt obligations of which (or the parent holding
company'of which) are rated equivalent to the Bonds by the
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rating agency then maintaining the rating on the Bonds; if
the date of purchase is the same as the Alternative Security
Effective Date, then the rating agency referred to above
shall be the same rating agency which will issue a rating on
the Bonds to be effective on or after the` Alternative
Security Effective Date; (e) an investment agreement issued
by an, insurance company, the unsecured debt obligations of
which (or the unsecured debt obligations of the parent
holding company . of such insurance company) are rated
equivalent to the Bonds by the rating agency then
maintaining the rating on the Bonds; if the-date of purchase
is the same as the date of the Alternative Security
Effective Date then the rating agency referred to above
shall be the same rating agency which will issue a. rating on
the -Bonds to be effective on or after the Alternative
Security Effective Date); (f) municipal obligations rated
"Aaa" or the equivalent by the rating agency then
maintaining the rating on the Bonds; if the date of purchase
is the same as the Alternative Security Effective Date, then
the rating agency referred to above shall be the,same rating
agency which will issue a rating on the Bonds to be
effective on or after the date of the Alternative Security
Effective Date; or (g) demand or time deposits, whether
interest-bearing or non-interest-bearing (including
certificates of deposit) in banks, including United States
branches of foreign banks, the unsecured debt obligations of
which (or the unsecured debt obligations of the parent
holding companyj are rated in the highest- investment grade
by the rating agency then maintaining the rating on the
Bonds; if the date of purchase is the same as the
Alternative Security Effective Date, then the rating agency
referred to above shall be the same rating agency which will
issue a rating on the Bonds to be effec tive on or after the
Alternative Security Effective Date.
Section 5. (a) Article XIII is amended by replacing Section
13.01, subsection B. with the following.
Section 13.01, Subsection B. Alternative Security Man-
datory Tender. The Bonds are subject to -an Alternative
Security Mandatory Tender at par plus 'accrued interest
through the Alternative Security Effective Date, on the
third (3rd) Business Day immediately preceding the.
Alternative Security Effective Date; provided, however, that
if and 'to the extent Alternative Security will be provided
on such date, the Registered owner of each Bond or.Bonds has
the right to have his Bond or Bonds excluded from such
Alternative Security Mandatory Tender by providing-written
notice of such election to the -Trustee. The Notice of
Alternative Security.Mandatory Tender will be sent to all
Registered Owners of,the Bonds at least 30 days prior to the
Alternative Security Effective Date. Such Notice of
Alternative Security Mandatory Tender shall state the nature
and amount of Alternative Security, the rate or rates on the
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Bonds subsequent to the Alternative Security Mandatory
Tender which shall be no less than the original interest
rate on the Bonds, the fact that the-existing rating on the
Bonds will expire on or after the Alternative Security
Effective Date and the description of a new rating, if any,
beginning on or after the Alternative Security Effective
Date to be assigned to the Bonds by a rating agency
identified in said notice and the name, and address of the
Tender Agent, if other than the Trustee, to which tendered
Bonds must be delivered pursuant to Article XIII hereof.
Written notice of-each Registered-Owner's intention to be
excluded from the Alternative Security Mandatory Tender must
be received in writing by the Trustee or, if other than the
Trustee, the Tender Agent, as appropriate at least ten (10)
days prior to the Alternative Security Effective Date. If
the Registered Owner(s) of all the Bonds outstanding have
elected to be excluded from the Alternative Security
Mandatory Tender, the Trustee or Tender Agent as appropriate
shall immediately inform the Bank, the Company and the
appropriate rating agency. On such notice, the'Company with
consent of the Bank and with notice to such-rating agency
may accelerate the Alternative Security Effective*Date'up to
twenty-eight (28) days. If the remarketing proceeds'of-the
Bonds and other funds to be available on the third (3rd)
Business Day immediately preceding the.Alternative Security
Effective Date, with respect to which the Trustee has
received an Opinion of Bankruptcy Counsel, are less than
enough to pay all Bonds not excluded from the Alternative
Security Mandatory Tender on the 'Alternative Security
Effective Date, the Notice of Alternative Security Mandatory
Tender shall be deemed to be cancelled and withdrawn, the
Alternative Security shall not be accepted and the
Alternative Security Mandatory Tender shall be deemed to be
cancelled and withdrawn, the Alternative Security' shall not
be accepted and the Alternative Security Mandatory Tender
shall not be made. Bonds purchased on the third (3rd)
Business Day immediately preceding the Alternative Security
Effective Date shall be remarketed at the direction of the
Company pursuant to the terms of this Indenture.
(b) The term "Alternative Security Optional Tender" is
deleted where it appears as a defined term and is replaced
with the following: "Alternative Security Mandatory
Tender."
Section 6. Article III is amended by replacing Section 3.01
with the following:
Section 3.01. Form of Bonds. The Bonds, the
certificate of authentication and the form of assignment
shall be substantially in the form set forth in the'Bond
Form-(Exhibit A), which'Bond Form is a part hereof and by
this reference is incorporated herein. All Bonds, including
Bonds issued upon transfer or exchange for other Bonds,
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shall be in fully registered form, and, except as provided
in Section 3.05 hereof, the person in whose name any Bond is
registered shall be regarded as the absolute owner thereof
for all purposes of this Indenture. , Bonds shall be
negotiable instruments in accordance with the Act, and.shall
express thereon the purpose for which they are issued and
such other statements or legends as may be required.by law.
The definitive Bonds shall be printed, lithographed or
engraved or produced by any combination of these methods,
all as determined by the officers .executing such Bonds and
as shall be evidenced by their execution-of such Bonds.
Section 7. Article V is amended by replacing 5.03C with the
following.
C. Drawing on Alternate Security. The Trustee is
directed to draw on the Alternate Security in an amount or,
amounts equal to the Company Note payment(s) then due in a
manner so as to assure the amount.on deposit and in the Bond
Fund is sufficient to make payments of principal of,'
interest and any redemption premium on the Bonds when due.
Draws on the,Letter,of Credit shall be deposited into the
Bond Fund and, subject to any reimbursement agreement with
the Bank, shall be considered payments by the Company.
Section 8. Article XII is amended by replacing 12.02 with
the following:
12.02. When Floating or Fixed Rate.
A. From January 22, 1985 until September 15, 1986,
the Bonds shall bear interest at a fixed interest rate
determined as follows:
On January 15, 1985 and at least 20 days prior to the
Alternative Security, Effective Date,'- the Indexing Agent
shall compute the Fixed Interest Index, as provided in
Section 12.05 A, and shall immediately notify the Trustee
and the Remarketing Agent thereof, by telephone, telecopier,
telegraph, or such other means to which the Trustee and the
Remarketing Agent shall consent. The Remarketing Agent
shall compute the fixed interest rate based on the'Fixed
Interest Index as so computed, as follows:
The fixed interest rate shall be that rate which, if
borne by the Bonds, would in the judgment of the Remarketing
Agent be the rate necessary to enable the Bonds to be
remarketed at par.' The interest rate shall be determined by
the Remarketing. Agent in its sole judgment based on'
evaluation at par of-no fewer than 10 tax-exempt issues of
comparable credit ratings and time periods during which the
rate is fixed. In no event may the fixed interest rate be"
less than 80% of the Fixed Interest Rate Index or greater
than 120% of such..Index. The Remarketing Agent shall
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finally determine the fixed interest rate no later than five
(5) days prior to (i) January 22, 1985 and (ii) the
Alternative Security Effective Date as applicable.
The fixed interest rate shall be - subject- to
verification by the Trustee, but otherwise shall be binding
upon the Bondowners, the Issuer, the Trustee, the Tender
Agent, the Remarketing Agent, the Company, and the Bank.
The Remarketing Agent shall notify the Trustee and the
Company of the fixed interest rate, by telephone,
telecopier, telegraph or such other means as to which the
Trustee and the Company shall consent.
B. From September 15, 1986, the Bonds shall bear
interest at the floating rates determined under Section
12.04. The floating rate may be converted to a fixed rate
in accordance with Section 12.05 and, once converted, shall
remain fixed until the final maturity of the Bonds.
Section 9. Article XII is amended by replacing 12.04 with
the following:
Section 12.04. Floating Rates.
A. Computation of Index. During any period when,
pursuant to Section 12.02, the Bonds are to bear interest at
a-floating rate, no later than 11:30 a.m. local time of the
Indexing Agent on the fourth (4th) Business Day immediately
preceding the first (1st) day of each Floating Rate Period,
the Indexing Agent shall compute the Floating Interest Index
and notify the Trustee, the Remarketing Agent and the
Company thereof. Such computation shall be binding upon the
Bondholders, the Issuer, the Trustee,,the Tender Agent, the
Remarketing Agent, the Company and the Bank. The floating
Interest index shall be based, on evaluations at par of no
fewer then twenty (20) tax-exempt issues of comparable
credit rating and time periods during which interest rates
remain fixed, to the Bonds.
B. Determination of Rate. Immediately upon receipt of
the Floating Interest Index, but in no event later than 4:00
p.m. local time of the-Remarketing Agent on the fourth (4th)
Business Day immediately preceding the first. (1st) day of
each Floating Rate Period, the. Remarketing Agent shall
determine the rate for such Floating Rate Period.
The rate shall be a rate which,, if borne by'the Bonds
would, in the judgment of the Remarketing Agent, giving due
regard to prevailing market conditions, be the interest rate
just necessary to enable the Remarketing Agent to r-emarket
the Bonds at par. The interest rate shall be determined by
the Remarketing Agent in its sole judgment based `on
evaluations.at par of no fewer than 10 tax-exempt issues of
comparable credit ratings and time periods during which
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interest rates remain fixed. In no event may the floating
interest rate be less than 80% of the Floating Interest
Index or greater than 120% of such Index.
C. Immediately upon determination of the rate for any
Floating Rate Period, the Remarketing Agent shall notify the
Trustee and the.Company of the interest- rate for such
Floating Rate Period. The interest rate-shall be subject to
verification by the Trustee, but otherwise shall be binding-
upon the Bondholders, the Issuer, the_Trustee, the Tender
Agent, the Remarketing Agent, the Company and the Bank.
Section 10. Article XII is amended by replacing Section
12.05 A with the following:
A. Fixed Interest Index. During any time when the
Bonds bear interest at a floating rate, the Indexing Agent
shall compute the Fixed Interest Index at any time at the
request and expense of the Company. The Fixed. Interest
Index shall be computed in like fashion as is prescribed in-
Section 12.04 for the Floating Rate Index. The Indexing
Agent immediately shall notify the Trustee, and the
Remarketing Agent of the Fixed Interest- Index,. and the
Remarketing Agent shall immediately notify the issuer, the
Tender Agent, the Company and the Bank of the Fixed Interest
index as so computed.
Section 11. Article XII is amended by replacing Section
12.05 C with the following:
C. Fixed Rate. On the third (3rd) Business Day
immediately preceding the twentieth (20th) day prior to the
Conversion Date, as so established,-the Indexing Agent shall
again compute'the Fixed Interest Index and shall notify the
Trustee and the Remarketing Agent thereof, by telephone,
telecopier, telegraph, or such other means to which the
Trustee and the Remarketing Agent shall consent. On the
second (2nd) Business Date immediately preceding the
twentieth (20th) day prior to the Conversion Date, the
Remarketing. Agent shall compute the fixed, interest rate
based on the Fixed Interest Index as so computed, as
follows:
The fixed interest rate shall be that rate, which if,
borne by the Bonds, would in the judgment of the Remarketing
Agent be just the rate necessary to enable the Remarketing
Agent to remarket the Bonds at.par. The fixed interest rate
shall be calculated by the Remarketing Agent in like fashion
as provided in-Section 12.04 for the.Floating Interest Rate.
In no event may the fixed interest rate be less than 80% of
the Fixed Rate Index or greater,than 120$ of such Index.
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The fixed interest rate shall be subject to
verification by the Trustee, but otherwise shall be binding
upon the Bondholders, the Issuer, the .Trustee, the Tender
Agent, the Remarketing Agent, the Company,-and the Bank.
The Remarketing, Agent shall notify the -Trustee and the
Company of the fixed interest rate, by telephone,
telecopier, telegraph or such other means as to which the
Trustee and the Company shall consent.
Section 12. (a) , Article XIII is amended by replacing
Section 13.01 A(1) with the following:
(1) Any Bond shall be purchased, at the demand of the
owner thereof, at'par plus accrued interest to the date of
purchase, on the last Business Day of any Floating Rate-
Period upon (i) receipt 'by the Remarketing Agent at least
seven (7) days before the purchase date of a written notice
that states the principal amount of such Bond and (ii)
delivery of the following to the office of the Tender Agent
at or prior to 10:00 a.m. local time of the Tender Agent on
the purchase date: (a) the Bond (with all necessary
endorsements), (b) a copy of the notice described in clause
(i) above, (c) instructions for the payment of -the,purchase
price (by wire transfer or by check or-draft mailed or
delivered in person at the office of the Tender Agent on the
purchase -date), and (d) in the case of a Bond to be
purchased prior to an Interest Payment Date and after the
Regular Record Date immediately preceding such Interest
Payment Date, a due-bill check, in form satisfactory to the
Tender Agent,, for interest due on such Interest Payment
Date. Any Bond(s)- subject to the notice received by the
Remarketing Agent pursuant to this subsection shall be
deemed purchased on the purchase date for remarketing
whether or not actually received by the Tender- Agent as-
provided.
Section"13. All 'other provisions of the Indenture remain in
full force and effect, unchanged by this Supplemental Indenture.
* * * * * * * * * *
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INDENTURE
between
TOWN OF AVON, COLORADO
(as Issuer)
and
THE PHILADELPHIA NATIONAL BANK
(as Trustee)
Dated as of December 15, 1984
$9,000,000
INDUSTRIAL DEVELOPMENT REVENUE BONDS
(Avon/Beaver Creek Holiday Inn Hotel, Project)
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TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
Section 1.01 Definitions.....
Section 1.02 Interpretation
ARTICLE II
AUTHORIZATION AND
TERMS OF BONDS
Section 2.01 Authorized Amount of Bonds
Section 2.02 Issuance of Bonds
Section 2.03 Delivery of Bonds.......................
ARTICLE III
TERMS OF BONDS GENERALLY
Section 3.01
Section 3.02
Section 3.03
Section 3.04
Section 3.05
Section 3.06
Section 3.07
Section 3.08
Form of Bonds . . . . . . . . . . . . . . . . . . .
.
Terms
Execution and Authentication of Bonds;
Limited Obligations.................
Temporary Bonds........ ooo o.oo..&
Payment of Bonds... o ooo.o.o 0
Transfer, Exchange and Ownership of
Bonds
Mutilated, Lost, Wrongfully Taken or
.
Destroyed Bonds... o oo..oo.oo
Surrender and Cancellation of Bonds.....
ARTICLE IV
REDEMPTION OF BONDS
Section 4.01 Terms of Redemption of Bonds............
Section 4.02 Partial Redemption... 00*000000000*000000
Section 4.03 Purchase in Lieu of Redemption..........
Section 4.04 Notice of Redemption
Section 4.05 Payment of Redeemed Bonds
Page
1-1
1-8
2-1
2-1
2-1
3-1
3-1
3-1
3-2
3-2
3-3
3-4
3-5
4-1
4-1
4-1
4-1
4-2
ARTICLE V
PROVISIONS AS TO FONDS,
PAYMENTS, PROJECT AND AGREEMENT
Section
5.01
Application of Proceeds
5-1
5-1
Section
5.02
Construction Fund
5-3
Section
5.03
Bond Fund...
5-4
Section
5.04
Investment of Funds,,....."........
5-4
Section
5.05
Moneys to be Held in Trust..............
5-5
Section
5.06
Non-Presentment of Bonds...
5-5
Section
5.07
Surplus Funds...........................
f
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ARTICLE VI
THE TRUSTEE, PAYING AGENTS AND AUTHENTICATING AGENTS
Section 6.01
Trustee's Acceptance and
6-1
Responsibilities
Section 6.02
Fees, Charges and Expenses of the
6-4
"
Fiduciaries........
6-4
Section 6.03
Intervention by Trustee.,*...*......**. .
6-4
Section 6.04
Successor Trustee
6-5
Section 6.05
Appointment of Co-Trustee...............
-5
6
5
Section 6.06
Resignation by the Trustee
6
-
Section 6.07
Removal of the Trustee 0000000000000
6-6
Section 6.08
Appointment of Successor Trustee.........
6-7
Section 6.09
Adoption of Authentication....
Section 6.10
Designation and Succession of
-7
6
Authenticating and Paying Agents......
Section 6.11
Fiduciary Protection
6-8
ARTICLE VII
DEFAULT PROVISIONS AND REMEDIES OF
TRUSTEE AND BONDHOLDERS
Section 7.01
Defaults; Events of Default
7-1
7-2
Section 7.02
Notice if Default occurs
7-2
Section 7.03
Acceleration.... 0.0006.0000.00000000.000
Rights of Bondholders...
dies
R
7-3
Section 7.04
Section 7.05
;
eme
Other
Right of Bondholders to Direct
7-3
Proceedings
7-4
Section 7.06
Application of Moneys... 0000000000000000
-5
7
5
Section 7.07
Remedies Vested in Trustee
7
-
.
Section 708
Rights and Remedies of Bondholders......
7-6
.09
Section 7
Termination of Proceedings..............
7-7
Section 7.10
Waivers of Events of Default............
ARTICLE VIII
SUPPLEMENTAL INDENTURES: AMENDMENTS TO DOCUMENTS
Section 8.01
Supplemental Indentures Generally.......
8-1
Section 8.02
Supplemental Indentures Not Requiring
8-1
Consent of Bondholders
Section 8.03
Supplemental Indentures Requiring
8-2
Consent of Bondholders
Section 8.04
Consent of Company, Bank and
8-3
Fiduciaries
Section 8.05
Authorization to Trustee; Effect
8-4
of Supplement.........................
8-4
Section 8.06
Opinion of Counsel
8-4
Section 8.07
Modification by Unanimous Consent.......
Section 8.08
Amendments to Basic Documents Not
Requiring Consent of Bondholders......
8-5
Section 8.09
Amendments to Basic Documents Requiring
8-5
Consent of Bondholders
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• •
ARTICLE IX
DEFEASANCE
Section
9.01
Release of Indenture
9-1
Section-
9.02
Payment and Discharge of Bonds..........
9-1
ARTICLE R
COVENANTS AND AGREEMENTS OF THE ISSUER
Section
10.01
Covenants and Agreements of the Issuer.
10-1
Section
10.02
Performance of Covenants, Authority
and Action
10-2
ARTICLE XI
MISCELLANEOUS
Section
11.01
Instruments of Bondholders
11-1
Section
11.02
Limitation of Rights
11-1
Section
11.03
Severability
11-2
11-2
Section
Section
11.04
11.05
Notices
Payments, Tenders and Redemptions
Due on Business Days
11-2
Section
11.06
Priority of this indenture
11-2
Section
11.07
Extent of Covenants; No Personal
11-2
Liability............................
11-3
Section
11.06
Binding Effect.........................
11-3
Section
11.09
Counterparts
11-3
Section
11.10
Captions
11-3
Section
11.11
Governing Law
ARTICLE XII
INITIAL FIXED RATE AND SUBSEQUENT FIXED
FLOATING OR FIXED RATES
Section
12.01
Initial Fixed 'Rate
12-1
Section
12.02
When Floating or Fixed Rate............
12-1
Section
12.03
Calculation of Interest Accrual........
12-1
12-2
Section
1 2 . 0 4
Floating Rates.... 0000000000000000000 . .
12-2
Section
12.05
Conversion to Fixed Interest Rate......
ARTICLE XIII
TENDER AND REMARKETING
Section
13.01
Tenders................................
13-1
13-3
Section
13.02
Remarketing
Section
13.03
Purchase of Bonds Delivered to the
13-4
Tender Agent
13-5
Section
13.04
Escrow Fund
-iii-
1. 1, •
•
ARTICLE XIV
INDEXING AGENT, TENDER AGENT AND RERARRETING AGENT
Section 14.01 Indexing Agent 14-1
Section 14.02 Tender Agent 14-1
. . . . . 14-2
Section 1 4 . 0 3 Remarketing Agent 00000000000000000'
Exhibit A Form of Bond
-iv-
•
INDENTURE
This indenture is made and entered into as of the Dated
Date, as defined below, by and between the Issuer and the
Trustee, each as identified below, under the circumstances in the
following recitals (the capitalized terms in the recitals and
granting clauses having the meanings set forth in Article I
below):
WHEREAS, pursuant to and in accordance with the laws of the
State, including the Act, the Issuer has determined to issue and
sell the Bonds in the aggregate principal amount specified on the
cover page hereof to assist the Company in the financing of the
costs of Acquiring the Project;
WHEREAS, the Bonds will be secured by this Indenture and the
Issuer is authorized to execute and deliver this Indenture and to
do or cause to be done all acts and things herein provided or
required on its part to be done;
WHEREAS, all acts,-conditions and things required to happen,
exist and be performed precedent to and in the issuance of the
Bonds and the execution and delivery of this Indenture have
happened, exist and have been performed in order to make the
Bonds, when issued, delivered and authenticated, valid
obligations of the Issuer in accordance with the terms thereof
and hereof, and in order to make this Indenture a valid, binding
and legal trust agreement for the security of the Bonds in
accordance with its terms; and
WHEREAS, the Trustee has accepted the trusts created by this
Indenture, and in evidence thereof has joined in the execution
hereof;
NOW, THEREFORE, THIS INDENTURE WITNESSETH, that in order to
secure the payment of the Bond service charges on the Bonds
according to their true intent and meaning, and to secure the
performance and observance of all the covenants and conditions
therein and herein contained and to declare the terms and
conditions upon and subject to which the Bonds are. and are
intended to be issued, held, secured and enforced, the Issuer, in
consideration of the premises and the acceptance by the Trustee
of the trusts hereby created and of the purchase and acceptance
of the Bonds by the holders thereof, and for other good and
valuable consideration, the receipt of which is hereby
acknowledged, has executed and delivered this Indenture and does
hereby transfer to the Trustee, and to its successors in trust,
and its and their assigns, (a) all amounts receivable by or on
behalf of the Issuer under the Basic Documents and the interest
of the Issuer in all moneys and investments in the Funds, and (b)
all right, title and interest of the Issuer in and to the Basic
Documents (other than any rights of the Issuer thereunder to
-1-
indemnity or notice) and (c) all money, obligations and
securities conveyed, assigned, hypothecated-, endorsed, pledged,
mortgaged, granted, or'delivered to or held by the Trustee in any
Fund and all earnings thereon.
TO HAVE AND TO HOLD unto the Trustee and its successors in
said trust and its and their assigns forever;
BUT IN TRUST, NEVERTHELESS, and subject to the provisions
hereof, for the equal and proportionate benefit, security and
protection of all present and future holders of,.,the Bonds issued
or to be issued under-and secured by this Indenture, and for the
enforcement of the payment of the Bond service -charges on the
Bonds, when payable, according to the true intent and meaning
thereof and of this Indenture and to secure the performance of
and compliance with the covenants, terms and conditions of this
Indenture, without preference, priority or distinction, as to
lien or otherwise, of any one Bond over any other by reason of
designation, number, date of authorization, issuance, sale,
execution or delivery, date of the Bonds or of maturity, or
otherwise, so that each and all Bonds shall have the same right,
lien and.;privilege under this Indenture, and shall be equally and
ratably secured hereby, it being intended that the lien and
security of this Indenture shall take effect from the -date
hereof-, without regard to the date of actual issue, sale or
disposition -of the -Bonds as though upon such date all the Bonds
were actually issued, sold and delivered to purchasers for value;
provided, however, that if the Issuer, its successors or assigns
shall well and truly pay, or cause to be paid, the Bond service-
. charges, at the times and in the manner mentioned in the Bonds
according to the true intent and meaning thereof, or. shall have
caused the outstanding Bonds to have been paid and discharged. in
-accordance with Sections 9.01 and 9.02 of this Indenture, shall
well and truly keep, perform and observe all the covenants and
conditions pursuant to the terms of this Indenture to be kept,
performed and observed by it, and shall pay or cause to be paid
to the Fiduciaries all sums of money due or to become due to'them
in -accordance with the terms and provisions hereof, then this
Indenture and the rights hereby granted shall cease, determine
and be void; otherwise, this Indenture shall be and remain in
full force and effect.
And it is expressly declared that all Bonds issued and
secured hereunder are to be issued, authenticated and delivered
and all Revenues hereby transferred are to be dealt with and
disposed of under, upon and subject to the terms, conditions,
stipulations, covenants, agreements, trusts, uses and purposes
provided in this Indenture, and the issuer has agreed and
covenanted, and doeshereby further agree and covenant, with the
Trustee and with the respective holders from time to time, of the
Bonds, or any part thereof, as follows:
-2-
ARTICLE I
DEFINITIONS
Section 1.01. Definitions. In addition to the words and
terms defined elsewhere in t is Indenture unless the context or
use clearly indicates another meaning or intent, the following
terms shall have the meanings set forth below when used herein:
"Acquire" and its variants: acquire, construct, improve,
furnish, equip, repair and rehabilitate, as applicable.
"Act": Colorado and Municipality Development Revenue Bond
Act (codified in Colorado Revised Statutes, 1973, as amended,
Title 29, Article 3).
'Agreement": the Loan Agreement, dated as of the Dated
Date, between the Company and the Issuer.
"Alternate Security" or "Alternative Security": an
investment agreement, letter of credit, insurance policy,.
guarantee or other credit enhancement device which meets all of
the following criteria: (i) the amount of the Alternative
Security must be sufficient to pay at par all principal and
interest on the Bonds due at any time up to and including the
mandatory tender date and as specified in the Notice of
Alternative Security Optional Tender the interest and principal
due on any Bonds tendered but not remarketed in any Alternative
Security Optional Tender and (ii) written confirmation has been
received by the Trustee from Moody's Investors Service or such
other nationally recognized rating agency or as shall then be
rating the Bonds that the substitution of the Alternative
Security for the Original Investments will not adversely affect
the rating then maintained on the Bonds.
"Alternative Security Effective Date": the date set forth
in the Notice of Alternative Security Optional Tender provided
all of the following conditions are met: (i) Alternative
Security has been posted and (ii) all Bonds tendered pursuant to
the Alternative Security Optional Tender which have not been
remarketed pursuant to Section 13.02 have been redeemed.
"Applicable jurisdiction": the area within the political
boundaries of the Issuer or those of the public entity on behalf
of which it acts and all areas within one-half mile of the
Project, whether or not located within the aforementioned area.
"Authenticating Agent": the Trustee and any other bank or
trust company appointed as such by or pursuant to this Indenture.
1-1
"Bank": the provider of any Alternate Security.
'Bank Representative: any person or persons designated by
the Bank from time to time to act on its behalf under the
Indenture.
"Bankruptcy Law": Title 11 of the United States Code, or
similar federal, state, or foreign law for the relief of debtors.
"Basic Documents" or "Documents': the Indenture, Agreement,
Company Note, and Purchase Contract.
"Bond" or 'Bonds": all Bonds issued pursuant hereto.
'Bond Counsel": Stowe & Herskovits, Denver, Colorado.
"Bond Form": Exhibit A hereto.
'Bond Fund": the fund created pursuant to Section 5.03
hereof.
"Bondholder' or 'holder' or 'holder of Bonds': the person
in whose name a Bond is registered; also known as "Bond Owner."
"Bond Owner" or owner* or 'Owner of Bonds': the person in
whose name a Bond is registered.
"Bond Payment Date' or "Interest Payment Date": each date
on which interest or both principal and interest are payable on
any of the Bonds according to their respective terms, whether by
scheduled payment or mandatory redemption or acceleration, so
long as any Bonds are outstanding.
"Bond Purchase Contract", or "Purchase Contract' or 'Bond
Purchase Agreement" or "Purchase Agreement': the agreement, if
any, dated as of the date of the Bond Resolution among the
Issuer, the Original Purchaser and any other parties thereto
relating to the purchase of the Bonds by the original Purchaser
from the Issuer.
"Bond Register': the books maintained and kept by -the
Trustee for registration and transfer of Bonds pursuant to
Section 3.06 hereof.
"Bond Resolution': the resolution or ordinance of the
Issuer authorizing the issuance of the Bonds.
"Bond Service Charges' or "Bond service charges": for any
time period, the principal of and premium, if any, and interest
on the Bonds for such time period, including any amounts to
redeem Bonds pursuant to the Bond Form.
1-2
C
"Bond Year": December 15 to December 15.
"Business Day": any day other than a Saturday, Sunday or
day which is in the state in which the Principal Office of the
Trustee is located a legal holiday or a day on which banks are
authorized or obligated by law or executive order to close.
"City": Town of Avon, Colorado.
"Clerical Officer": Town Clerk of the Town of Avon,
Colorado.
"Code": the Internal Revenue Code of 1954, as amended.
"Code Section": Section 103 (b)(6).
"Company": Avon Resort Properties, Ltd., a Colorado limited
partnership.
"Company Cost Certificate" or "Cost Certificate": the Cost
Certificate executed by the Company with respect to the Project.
"Company Documents": the Agreement, Company Note, Cost
Certificate; if the Company is a signatory thereto, the Purchase
Contract.
"Company Note": note executed in connection with Agreement.
"Company Representative": any general partner of the
Company.
"Completion Date": August 15, 1986.
"Construction Fund":-• the fund by that name created pursuant
to Section 5.02 hereof.
"Conversion Date": the fifteentb (15th) day of a calendar
month or next Business Day, if appropriate, on which the interest
rate on the Bonds converts from a floating rate to a fixed
interest rate, as established in Article XII hereof.
"Cost of Funds": the semiannual cost of funds for FSLIC-
insured institutions as issued by the Federal Home Loan Bank
Board.
"Cross Receipt": the Delivery Certificate and Cross Receipt
relating to the Bonds executed by the Original Purchaser, the
Bank, if any, and the Trustee on the Delivery Date.
"Dated Date": December 15, 1984.
"Date of Official Action" or "Official Action Date":
December 30, 1983.
1-3
9 0
"Delivery Costs': all items of expense directly or
indirectly relating to the financing of the Project from the
proceeds of the Bonds, including but not limited to initial
Letter of Credit premiums, initial Fiduciary fees, underwriter's
fee, Issuer's fee and financial, legal and other professional
consultant fees and charges.
"Delivery Date`: December 31, 1984.
"Eligible investments": any of the following investments
which at the time are legal investments for the Issuer under the
laws of the Issuer's jurisdiction: (a) direct obligations of the
United States of America (including obligations issued or held in
book-entry form on the books of the Department of the Treasury of
the United States of America) or obligations the principal of and
interest on which are guaranteed by the United States of America;
(b) senior or collateralized debt of the Federal National
Mortgage Association; (c) interest-bearing demand or time
deposits (including certificates of deposit) in banks (including
the Trustee or affiliated bank) and savings and loan associations
provided that such deposits are insured by Federal Deposit
Insurance Corporation or Federal Savings and Loan Insurance
Corporation or National Credit Union Administration Share
Insurance Fund; (d) obligations of corporations or institutions
the unsecured debt obligations of which (or the parent holding
company of which) are rated equivalent to the Bonds by the rating
agency rating the Bonds; (e) an investment agreement issued by an
insurance- company, the unsecured debt obligations of which (or
the parent holding company of which) are rated equivalent to the
Bonds by a nationally recognized rating agency; (f) municipal
obligations rated "Aaa" or the equivalent, by the rating agency
rating the Bonds; or (g) interest-bearing demand or time deposits
(including certificates of deposit) in banks, including United
States branches of foreign banks, the unsecured debt obligations
of which (or the parent holding company of which) are rated
either Aaa or P-1 by Moody's Investors Service.
All such investments shall mature not later, nor, to the
extent reasonably practicable, earlier than the date such moneys
or investment proceeds are required for the purposes of the
respective Funds.
"Construction Fund": a fund created pursuant to Section
5.02 hereof.
"Event of Bankruptcy": a petition by or against the Company
or Bank under any Bankruptcy Law which shall have been filed
unless such petition shall have been dismissed within 60 days of
filing if involuntary and such dismissal shall be final and not
subject to appeal.
"Event of Default": any one of those events set forth in
Section 7.01 hereof.
1-4
•
0
"Executive" or "Executive officers": Mayor of the Town of
Avon, Colorado.
"Extraordinary Services' and "Extraordinary Expenses": all
services rendered and all reasonable expenses plus interest at
the Trustee's prime rate properly incurred by the Trustee under
this Indenture other than ordinary Services and Ordinary
Expenses.
"Fiduciaries': the Trustee, any Paying Agents,
Authenticating Agents, the Tender Agent, Indexing Agent and
Remarketing Agent.
"Fixed Interest Index": the fixed interest index calculated
in accordance with Article XII hereof.
"Floating Interest Index": the floating interest index
calculated in accordance with Article XII hereof.
'Floating Rate Periods': each calendar month beginning the
15th day of each month, during the period the Bonds bear interest
at a floating rate pursuant to Article XII hereof.
'Funds': any funds and accounts created pursuant to Article
V hereof.
'Government Obligations': direct general obligations of, or
obligations the payment of principal and interest of which are
unconditionally guaranteed by, the United States of America.
'Indenture': this Indenture, including all supplements.
"Indexing Agent": the Person appointed in accordance with
Section 14.01 hereof.
"Initial Investments": shall be (i) the initial
certificates of deposit securing the Bonds and (ii) any
investments purchased at the maturity of the investment described
in (i).
"Interest'Payment Dates': June 15 and December 15.
"Issuer": Town of Avon, Colorado.
. "Issuer Documents": the Indenture, Purchase Contract, and
Agreement.
"Issuer Representative": the person at the time designated
to act on behalf of . the Issuer by written certificate furnished
to the Company, the Bank and the Trustee, containing the specimen
signature of such person and signed on behalf of the Issuer by
its Executive officer or Clerical Officer. Such certificate may
designate an alternate or alternates who shall have the same
authority, duties and powers as such Issuer Representative.
1-5
'Legislative Authority": 'Town Council of the Town of Avon,
Colorado or other governing body of the issuer.
"Loan': the Company Loan.
'Mandatory Tender': a tender pursuant to Section 13.01 B.
"Minimum Denomination": Five Thousand Dollars ($5,000.00).
'Mortgage': any Security Agreement and either the Deed of
Trust, Assignment of Rents and Leases or the Mortgage, from the
Company, with respect to the Project . Personalty and Project
Realty, respectively.
"Notice Addresses': the respective addresses of the Issuer,
Company, Fiduciaries, ' and Original Purchaser.
"Official Statement": the official statement dated the date
of the Delivery Date relating to the Bonds.
'Opinion of Counsel": a written opinion of an attorney or
firm- of attorneys acceptable to the Trustee -who (except as
otherwise- expressly provided herein or in the Agreement) may be
counsel for the Company, the Bank or the Trustee.
"Ordinary Services' and "Ordinary Expenses': those services
normally rendered "and those expenses plus interest at the
Trustee's prime rate normally incurred by a trustee or paying
agent under instruments similar to this Indenture.
"Original Purchaser': Matthews & Wright, Inc., 14 Wall
Street,-New York, New York 10005.
"Outstanding Bonds" or "Bonds Outstanding" or "Outstanding"
as applied to Bonds: as of any date, all Bonds which have been
authenticated and delivered by the Trustee under the Indenture
except:
(a) Bonds surrendered for and replaced upon exchange
or transfer, or cancelled because of payment or redemption prior
to .maturity, at or prior to such date;
(b) Bonds for the payment, redemption or purchase for
cancellation of which sufficient moneys of Government Obligations
have been deposited prior to such date with the Trustee (whether
upon or prior to the maturity or redemption date of any such
Bonds),, or. which are deemed to have been paid and discharged,
pursuant to the provisions of the Indenture; provided that if
such Bonds are to be redeemed prior to the maturity thereof,
notice of such redemption shall have been given or arrangements
to . the reasonable satisfaction of the Trustee shall have. been
made therefor, -or waiver of such notice satisfactory in form to
the Trustee shall have been filed with the Trustee; and
1-6
i
0
(c) Bonds in lieu of which others have been
authenticated (or payment, when due, of which is made without
replacement) hereunder.
'Paying Agent-: the Trustee and any other bank or trust
company appointed as such by or pursuant to this Indenture.
"Payments": all payments to be made under Article V of the
Agreement.
"Person": a corporation, association, partnership,
organization, business, joint venture, individual, government or
political subdivision thereof or a governmental agency.
"Plans and Specifications": the plans and specifications
for the construction and installation of the Project on file or
to be filed with the Bank, together with such additions and
modifications thereto as made and approved by the Bank and the
Company.
"Principal office of the Trustee": means the office of the
Trustee designated herein or pursuant hereto for notices to the
Trustee hereunder.
"Principal User": "principal user" as that term is used in
Section 103(b)(6) of the Code.
"Project": Avon/Beaver Creek Holiday Inn Hotel.
"Project Costs": Delivery Costs and the cost of acquiring
the Project and shall include, without limitation, all amounts
paid and all costs and expenses incurred by the Company, the
Issuer, the Trustee and the Bank including .draws under the
Alternative Security to pay interest during construction prior to
the Completion Date, which constitute expenditures to finance the
Project within the meaning of the Act, including acquisition of
the Alternate Security, but excluding, interest on the Bonds to
the extent prohibited by the Act.
"Project Personalty": all goods, equipment, machinery,
inventory, supplies, fixtures, furniture, furnishings and all
other tangible personal property financed with the proceeds of
Bonds, and any substitutions and replacements thereof,
attachments, accessions and additions thereto.
"Project Purposes": acquiring real and personal property
ccmprising a project within the meaning of the Code Section .
"Project Realty": the real property described in. the
Mortgage, all appurtenances thereto, all rights of the Company in
and to any streets, roads or public places, easements or rights-
of-way relating thereto and any additional real property of any
kind hereafter subjected to the lien of the Mortgage.
1-7
0 0
'Regular Record Date': the Business Day preceding an
Interest Payment Date.
'Related Person': any "related" person as such term is
defined in Section 103(b)(6)(c) of the Code.
"Remarketing Agents: the Person appointed by the Issuer in
accordance with Section 14.03 hereof.
'Reserve Requirement': an amount equal to that percentage,
if any, of the initial aggregate principal amount of the Bonds,
as is specified on the Fact Sheet.
'Revenues': (i) all prepayments, repayments and any other
moneys, receipts or payments received pursuant to or in
connection with the Agreement or any other Basic Documents and
(ii) any interest or income received on investment of moneys held
in any Fund hereunder.
'Security', if any: the insurance policy or other
instrument of guarantee issued by the Bank, if any, on the
Delivery Date.
'Semiannual Dates': June 15 and December 15.
'Sinking Fund': a subsidiary fund of the Bond Fund pursuant
to Section 5.03.
'Special Record Date': the date established by the Trustee
in connection with the payment of interest in default on the
Bonds pursuant to Section 3.05 hereof.
'State': Colorado.
"Supplemental Indenture': any indenture supplemental to
this Indenture entered into between the Issuer and the Trustee in
accordance with Article VIII hereof.
"Tender Agent': the Person appointed by the Issuer in
accordance with Section 14.02 hereof.
'Trustee': The Philadelphia National Bank, Philadelphia,
Pennsylvania, and its successors, and any successor to the duties
of the Trustee hereunder, and any co-trustee at the time serving
as such hereunder.
'Trustee Documents': the Indenture.
Section 1.02. Interpretation. Any reference herein to the
Issuer, to the Legislative Authority or to any member or officer
of either shall include those succeeding to their functions,
duties or responsibilities pursuant to or by operation of law or
lawfully performing their functions. Any reference to a section
or provision or chapter of the Constitution of the State or the
1-8
• •
Act shall include such section or provision or chapter as from
time to time amended, modified, revised, supplemented or
superseded, provided that no change in Constitution or laws shall
be applicable solely by reason of this provision if such change
in any way constitutes an impairment of the rights or obligations
of the Issuer` the Bondholders, the Trustee, the Bank or the
Company under the Basic Documents, the Bond Resolution, the
Bonds, or any other document executed in connection with any of
the foregoing, including, without limitation, any alteration of
the obligation to pay Bond service charges in the amount and
manner, at the times, and from the sources provided in the Bond
Resolution and this Indenture, except as otherwise permitted
herein.
Unless the context shall otherwise indicate, words importing
the singular number shall include the plural number, and vice
versa; the terns "hereof". "hereby", "herein" t "hereto".
"hereunder" and similar terms refer to this Indenture; and the
term "hereafter" means after, and the term "heretofore" means
before, the effective date of this Indenture. Words of the
masculine gender include the feminine and the neuter and when the
sense so indicates words of the neuter gender may refer to any
gender.
1-9
C
ARTICLE II
•
AUTHORIZATION AND TERMS OF BONDS
Section 2.01. Authorized Amount of Bonds. No Bonds may be
issued under the provisions o this Indenture except in
accordance with this Article. The total authorized amount of
Bonds which shall be issued under the provisions of this
Indenture is the amount set forth on the cover page hereof,
except as provided in Section 3.07 hereof.
Section 2.02. Issuance of Bonds. It is determined to be
necessary to, and the Issuer -s-hall,, issue, sell and deliver the
principal amount of Bonds set forth on the cover page hereof;
shall be issuable only in fully registered form, substantially as
set forth in the Bond Form; substantially as set forth in
denominations specified in the Bond Form; shall be dated as of
the Dated Date; and shall bear interest from the Dated Date.
Section 2.03. Delivery of Bonds. Upon the execution and
delivery of this Indenture and satisfaction of the conditions
established by the Issuer for the delivery of the Bonds, the
Issuer shall execute and deliver to the Trustee, and the Trustee
shall authenticate, the Bonds and deliver them to, or on the
order of, the Original Purchaser thereof as may be directed by
the Issuer in accordance with this Section.
Prior to the original delivery by the Trustee of any of the
Bonds, there shall be filed with the Trustee:
1. Original executed counterparts -of the Basic Documents.
2. A copy, duly certified by the Clerical Officer, of the
Bond Resolution providing for the issuance and sale of the Bonds,
the approval of the Agreement and the Indenture and related
matters.
3. A request and authorization to the Trustee on behalf of
the Issuer, signed by Issuer Representative, to authenticate and
deliver the Bonds to, or on the order of, the original Purchaser
upon payment to the Trustee, but for the account of the Issuer,
of the sumo specified therein, which shall be deposited as
provided in Article V hereof.
4. Written direction from the Company to the Trustee as to
how the Bond proceeds are to be initially invested.
2-1
ARTICLE III
TERMS OF BONDS GENERALLY
Section 3.01. Form of Bonds. The Bonds, the certificate of
authentication and the form -o assignment shall be substantially
in the form set forth in the Bond Form (Exhibit A) , which Bond
Form is a part hereof and by this reference is incorporated
herein. All Bonds, including Bonds issued upon transfer or
exchange for other Bonds, shall be in fully registered form, and,
except as provided in Section 3.05 hereof, the person in whose
name any Bond shall be regarded as the absolute owner thereof for
all purposes of this Indenture. Bonds shall be negotiable
instruments in accordance with the Act, and shall express thereon
the purpose for which they are issued and such other statements
or legends as may be required by law. The definitive Bonds shall
be printed, lithographed or engraved or produced by any
combination of these methods, all as determined by the officers
executing such Bonds and. as shall be evidenced by their execution
of such Bonds.
Section 3.02. Terms. Subject to the provisions of this
Indenture, the Bonds shall mature on the date, in such year or
years. and in such amount or amounts, shall bear interest at such
rate or rates per annum payable on such dates, and shall have
such other terms as set forth in the Bond Form.
Section 3.03. Execution and Authentication of Bonds;
Limited Obligations. The Bonds shall be signed in their official
capacities by the Executive Officer and the Clerical Officer,
provided that either or both of such signatures -may be
facsimiles, and shall bear the seal or a facsimile seal of the
Issuer if the Issuer has an official seal. In case any officer
whose signature or a facsimile of whose signature shall appear on
any Bonds shall cease to be such officer before the issuance of
such Bonds, such signature or such facsimile shall nevertheless
be valid and sufficient for all purposes, the same as if he had
remained in office until that time. Any Bonds may be executed on
behalf of the Issuer by an officer who, on the date of execution
is the proper officer, although on the date of such Bonds such
person was not the proper officer.
No Bond shall be valid or become obligatory for any purpose
or shall be entitled to any security or benefit under this
Indenture unless and - until a certificate of authentication,
substantially' in the form set forth herein, shall have been duly
endorsed upon such Bond by the Trustee or by ' any Authenticating
Agent on behalf of the Trustee. Such authentication by the
Trustee or an Authenticating Agent upon any Bond 'shall be
conclusive evidence that the Bond so authenticated has been duly
authenticated and delivered hereunder "and is entitled to the
security and benefit of this Indenture. Such certificate of the
Trustee or an Authenticating Agent may be executed by any person
3-1
0 •
duly authorized by the Trustee or Authenticating Agent, but it
shall not be necessary that the same person sign the certificate
of authentication on all of the Bonds.
To the extent provided in and except as otherwise permitted
by the Indenture, the Bonds shall be limited -obligations of the
Issuer, shall be equally and ratably payable solely from the
Revenues and shall be secured by an assignment of the Revenues
and by this Indenture. Anything in the Bond Resolution, the
Bonds or this Indenture to the contrary notwithstanding, the
Bonds do not and shall not represent or constitute a debt or
pledge of the faith and credit of the Issuer.
Section 3.04. Teaporary Bonds. Pending the preparation of
definitive Bonds, 'or by agreement with the original Purchaser,
the Issuer may execute and,. 'upon its request, the Trustee shall
authenticate and deliver, temporary Bonds which shall be printed,
lithographed,' 'photocopied, typewritten or otherwise produced,
shall be in the denominations specified herein for, definitive
Bonds and shall be substantially of the tenor of the definitive
Bonds in lieu of which they are issued.
If temporary Bonds are issued, the Issuer will cause
definitive Bonds to be prepared without unreasonable delay.
After the preparation of definitive Bonds, the. temporary Bonds
shall be exchangeable, without charge to the holder, for
definitive Bonds upon presentation and surrender of the temporary
Bonds at the principal Office of the Trustee.or at the designated
office of an Authenticating Agent. Upon surrender -for
cancellation of any one or more temporary Bonds, the Issuer shall
execute, and the Trustee or any other Authenticating Agent shall
authenticate and deliver, a like principal amount of definitive
Bonds of authorized dencminations in exchange therefor. Until so
exchanged, the temporary Bonds shall be entitled in all respects
to the same benefits under the Indenture as definitive Bonds.
Section 3.05._ Payment of Bonds. Bond service charges shall
be payable, in lawful money of the United States of America
without deduction for the services of any Paying Agent. The
principal of and premium, if any, on all Bonds shall be payable
upon presentation and -surrender of such Bonds at the Principal
Office of the Trustee- or- at the designated office of any other
Paying. Agent. Interest on any Bond shall be paid on each'
Interest, Payment Date by check or draft drawn on the Trustee
mailed to. the person who is the holder of such Bond at the
address appearing on the Bond Register at the close of business
on the .Regular Record Date pertaining to such Interest Payment
Date; provided, however,. that if and to the extent the Issuer
shall default in the payment or provision for payment of interest
on any Bond on any Interest Payment Date,, such interest in
default shall cease to be payable to the person. who was the,
holder of such Bond as of the Regular Record Date. Whenever
moneys become available for the payment of such defaulted
interest, the Trustee' shall establish a Special Record Date for
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• •
the payment of such defaulted interest which shall be not more
than fifteen (15) nor less than ten (10) days prior to the date
of the proposed payment, and the Trustee shall cause notice of
the proposed payment and of such Special Record Date to be mailed
by first class mail, postage prepaid,. to each Bondholder at his
address as it appears on the Bond Register not less than ten (10)
days prior to such Special Record Date. Such notice having been
so mailed, the defaulted interest shall be payable to the persons
who are the holders of the Bonds at the close of business on such
Special Record Date.
Notwithstanding the foregoing, payment of interest on the
Bonds, at the option of any holder of at least $1,000,000
aggregate principal amount of Bonds, shall be made by wire
transfer in immediately available funds to such holder to the
bank account on file with the Trustee on the applicable Regular
or Special Record Date.
Subject to the foregoing, each Bond delivered under this
Indenture upon transfer thereof, or in exchange for or in lieu of
any other Bond, shall carry the rights to interest accrued and
unpaid, and to accrue on such Bond, or which were carried by such
other Bond.
Section 3.06. Transfer Exchange and Ownership of Bonds.
So long as any of the Bons remain outstanding, the Issuer will
cause to be maintained and kept, at the Principal office of the
Trustee as Bond Registrar, books for the registration and
transfer of Bonds as provided in this Indenture.
Bonds, upon presentation and surrender thereof at the
corporate trust office of the Bond Registrar or the designated
office of any Authenticating Agent, together with an assignment
duly executed by the holder or his duly authorized attorney in
such form as shall be satisfactory to the Bond Registrar or
Authenticating Agent, may, at the option of the holder, be
exchanged for Bonds of any authorized denomination in the
aggregated principal amount not exceeding the unmatured and
unredeemed principal amount of such Bonds, and bearing interest
at the same rate and maturing on the same date.
Any Bond may be transferred only upon the Bond Register,
upon presentation and surrender thereof at the corporate trust
office of the Bond Registrar or, at the option' of the holder, at
the designated office of any Authenticating Agent, together with
an assignment duly executed by the holder or his duly authorized
attorney in such form as shall be satisfactory to the Bond
Registrar or Authenticating Agent. Upon the transfer of any such
Bond and on request of the Bond Registrar or Authenticating
Agent, the Issuer shall execute in the name of the transferee,
and the Bond Registrar or any other Authenticating Agent shall
authenticate and deliver, a new Bond or Bonds of any authorized
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denomination, in aggregate principal amount equal to the
unmatured and unredeemed principal amount of such Bond, and
bearing interest at the same rate and maturing on the same date.
In all cases in which Bonds shall be exchanged or
transferred hereunder, the Issuer shall execute and the Bond
Registrar or any other Authenticating Agent shall authenticate
and deliver Bonds in accordance with the provisions of this
Indenture. Such exchange or transfer shall be without charge,
except that the Issuer and Bond Registrar or Authenticating Agent
may make a charge for every such exchange or transfer or Bonds
sufficient to reimburse them for any tax, fee or other
governmental charge required to be paid with respect to such
exchange or transfer and such charge or charges shall be paid
before any such new Bond shall be paid before any such new Bond
shall be delivered. All Bonds issued upon any transfer or
exchange of Bonds shall be the valid obligations of the Issuer,
evidencing the same debt, and entitled to the same benefits under
this Indenture, as the Bonds surrendered upon, and entitled to
the same benefits under this Indenture, as the Bonds surrendered
upon such transfer or exchange. Neither the Issuer, the Bond
Registrar nor any Authenticating Agent shall be required to make
any such exchange or- transfer of any Bond during a period
beginning at the opening of business fifteen (15) days before the
day of the mailing or to transfer or exchange any Bonds selected
for redemption in whole or in part.
Except as provided in Section 3.05 hereof, the person in
whose name any Bond shall be registered shall be deemed and
regarded as the absolute owner thereof for all purposes of this
Indenture, and payment of or on account of the Bond service
charges on any such Bond shall be made only to or upon the order
of such person or his duly authorized attorney in such form as
shall be satisfactory to the Bond Registrar, and neither the
Issuer, the Bond Registrar nor any Paying Agent shall be affected
by any notice to the contrary, but such registration may be
changed as hereinabove provided. All such payments shall be
valid and effectual to satisfy and discharge the liability upon
such Bond, including the interest thereon, to the extent of the
sum or sums so paid.
In case any Bond is redeemed. in part only, the Issuer, on or
after the redemption date and upon presentation and surrender of
such Bond, shall cause execution of, and the Trustee or any other
Authenticating Agent shall authenticate and deliver, a new Bond
or Bonds in authorized denominations and in aggregate principal
amount equal to the unredeemed portion of such Bond.
Section 3.07. Mutilated, Lost, Wrongfully Taken or
Destroyed Bonds. I any Bon is mutilated, ost, wrongfully
taken or estroyed, then in the absence of notice to the Issuer
or the Trustee that a lost, wrongfully taken or destroyed Bond
has been acquired by a bona f ide purchaser, the Issuer shall
execute, and the Trustee shall authenticate and deliver, a new
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Bond of like date, maturity and denomination as that mutilated,
lost, wrongfully taken or destroyed; provided, that in the case
of any mutilated Bond; such mutilated Bond shall first be
surrendered to the Trustee, and in the case of any lost,
wrongfully taken or destroyed Bond, there shall be first
furnished to the Issuer and the Trustee . evidence of such loss,
wrongful taking or destruction satisfactory to the Clerical
Officer of the Issuer and the Trustee, together with indemnity
satisfactory to them. If any such lost, wrongfully taken or
destroyed Bond shall have matured, instead of issuing a new Bond,
the Issuer, by its Clerical Officer, may direct the Trustee to
pay the same without surrender thereof upon the furnishing of
satisfactory evidence and indemnity as in the case of issuance of
a new Bond. The Issuer and the Trustee may charge the holder of
such Bond with their reasonable fees and expenses and interest
thereon in connection with their action pursuant to this Section.
Every new- Bond issued pursuant to this Section by reason of
any Bond being lost, wrongfully taken or destroyed shall
constitute an additional contractual obligation of the Issuer,
whether or not the lost, wrongfully taken or destroyed Bond shall
be enforceable at any time by anyone, and shall be entitled to
all the benefits of this Indenture equally and proportionately
with any and all other Bonds duly issued hereunder.
All Bonds shall be held and owned on the express condition
that the foregoing provisions of this Section are exclusive 'with
respect to the replacement or payment of mutilated, lost,
wrongfully taken or destroyed Bonds and shall preclude, to the
extent permitted by law, any and all other rights and remedies,
notwithstanding any law or statute existing.or hereafter enacted
to the contrary with respect to the replacement or payment of.
negotiable instruments or other securities without their
surrender.
Section 3.08. Surrender and Cancellation of Bonds. n
Bond surrendered pursuant to this Article for t e purpose
payment or retirement, or for exchange, replacement or transfer,
shall be cancelled upon presentation and surrender thereof to the
Trustee or any other Authenticating Agent or Paying Agent. Any
Bond cancelled by a Paying Agent or Authenticating Agent other
than the Trustee shall be promptly transmitted by such Paying
Agent or Authenticating Agent to the Trustee. The Issuer may at
any time deliver to the Trustee for cancellation any Bonds
previously authenticated and delivered hereunder, which the
Issuer may have acquired in any manner whatsoever, and all Bonds
so delivered shall be promptly cancelled by the Trustee.
Certification of such surrender. and cancellation shall be made to
the Issuer by the Trustee at least twice each calendar year.
Unless otherwise directed by the Issuer or other lawful
authority, cancelled - Bonds shall be promptly destroyed by
shredding or cremation by the Trustee, and certificates of such
destruction (describing the manner thereof) shall be provided by
the Trustee to the Issuer and the Company.
3-5
~ 1 0. 0
ARTICLE IV
REDEMPTION OF BONDS
Section 4.01. Terns of Redemption of Bonds. The Bonds are
subject to redemption prior to maturity as provided in the Bond
Form.
Section 4.02. Partial Redemption. If less than all of the
outstanding Bonds are called for redemption at one time, they
shall be called in inverse order of the maturities of the Bonds
outstanding, if there is more than one maturity, and if less than
all of the outstanding Bonds of one maturity are to be redeemed,
or if there is only one maturity, the selection of such Bonds, or
portions thereof in amounts of the Minimum Denomination or any-
integral multiple thereof, of such maturity to be called shall be
made by lot by the Trustee in such manner as the Trustee may
determine. In the case of a partial redemption of Bonds when
Bonds of denominations greater than the Minimum Denomination are
then, outstanding, each unit of face value of the Minimum
Denomination thereof shall be treated as though-it was a separate
Bond of the Minimum Denomination. If it is determined that one
or more, but not all of the Minimum Denomination units
represented by any such Bond are to be called for redemption,
then upon notice of intention to redeem such Minimum Denomination
unit or units, the holder of such Bond_shall surrender such Bond
to the Trustee (a) for payment of the redemption price (including
the premium', if any, and accrued interest to the date fixed for
redemption) of the unit or units of face value of the Minimum
Denomination called for redemption, and (b) for exchange, without
charge to the holder thereof, for a new Bond or Bonds of the same
interest rate and the same maturity and of any authorized
denomination or denominations in the aggregate principal amount
of the unredeemed balance of such Bond.
Section 4.03. Purchase in Lieu of. Redemption. Wholly or
partially in lieu o any mandatory redemption o -the' Bonds, the
Trustee may apply moneys on deposit in the Bond fund to the.
purchase of outstanding Bonds of the maturity or maturities to be
redeemed at a price (including brokerage or other charges) not
exceeding the redemption price of the bonds purchased, including
any premium 'and interest to the redemption date, all in such
manner as -the Trustee shall determine, at any time prior to the
giving of a notice of -redemption. In addition, mandatory Sinking
Fund requirements may be met by the Company delivering Bonds to
Trustee not later than the time required herein for the signing
of notice of such redemption.
Section 4.04. Notice of Redemption. Except in the case of
a redemption on or before January 22, 19851, notice of the call
for redemption of Bonds, identifying by, designation, letters,
numbers or other distinguishing marks, the Bonds, or-portions of
Bonds in. amounts of the Minimum Denomination or any integral
4-1
multiple thereof, to be redeemed, the redemption price to be
paid, the date fixed for redemption and the place or places where
the amounts due upon such redemption are payable, shall be given
by the Trustee on behalf of the issuer by mailing a copy of the
redemption notice by first class mail, postage prepaid, at least
thirty (30) days prior to the date fixed for redemption to the
holder of each such Bond to be redeemed at the address shown the
Bond Register provided, that failure to give such notice by
mailing with respect to a particular bond, or any defect in such
notice, shall not affect the validity of the proceedings for the
redemption of any of the other Bonds.
In the case of a redemption on or before January 22, 1985,
the Trustee upon receipt of notice that a mandatory redemption is
required pursuant to the Bond Form, shall immediately notify the
Bondowner of such redemption and redeem the Bonds on the Business
Day following such notification to the Bondowner.
Anything herein to the contrary notwithstanding, no notice
of redemption of bonds occasioned by optional Company Note
prepayment shall be given until the Trustee has received from the
Bank a sufficient amount of money to effect the redemption,
including interest to - the redemption date and any redemption
premium.
Section 4.05. Payment of Redeemed Bonds. Notice having
been given in the manner provided in Section 4.04. hereof, the
Bonds and portions thereof so called for redemption shall become
due and payable on the redemption date at the appropriate
redemption price, plus interest accrued to the redemption date,
and, upon presentation and surrender thereof at the place or
places specified in such notice, such Bonds and portions thereof
shall be paid at the appropriate redemption price plus interest
accrued to the redemption date. If, on the redemption date,
moneys for the redemption of all such Bonds and portions thereof
to be redeemed, together with accrued interest to the redemption
date, are held by the Trustee or any gther Paying Agent so as to
be available therefor on that date and if notice of redemption
shall have been given as aforesaid, then, from and after the
redemption date such Bonds and portions thereof so called for
redemption shall cease to bear interest and said Bonds and
portions thereof no longer shall be considered outstanding
hereunder. If said moneys shall not be so available on the
redemption date, such Bonds and portions thereof shall continue
to bear interest until paid at the same rate as they would have
borne had they not been called for redemption.
All moneys deposited in the Bond Fund and held by the
Trustee or Paying Agents for the redemption of particular Bonds
shall be held in trust for the account of the holders thereof and
shall be paid to them upon presentation and surrender of such
Bonds.
4-2
ARTICLE V
PROVISIONS AS TO FONDS,
PAYMENTS, PROJECT AND AGREEMENT
Section 5.01. Application of Proceeds. The proceeds
received by the Trustee from the sale of the Bonds shall be set
aside by the Trustee in the following respective funds and in the
following order of priority:
(1 ) In the Bond Fund, an amount equal to interest, if
any, accrued on the Bonds from the Dated Date to the
Delivery Date.
(2) The remainder of said proceeds, in the
Construction Fund.
Section 5.02. Construction Fund.
A. Establishment. The Trustee shall establish a special
fund designated as the "Construction Fund;" shall keep such fund
separate and apart from all other funds and moneys held by it;
and shall administer such fund as provided herein. There shall
be deposited in the Construction Fund the proceeds of sale of the
Bonds required to be deposited therein pursuant to Section 5.01,
and any other funds from time to time deposited with the Trustee
for such purpose.
B. Disbursements. The moneys in the Construction Fund
shall be disbursed for the payment of Project Costs, as follows:
(1) In the case of payment of Delivery Costs, the
Trustee shall disburse moneys in the Construction Fund only
upon receipt by the Trustee of a requisition signed by the
Issuer Representative and approved by the Bank, if any,
setting forth the amounts to be. disbursed for payment or
reimbursement of Delivery Costs and the Persons to whom said
amounts are to be disbursed, stating that the amounts to be
disbursed are for Delivery Costs properly chargeable to the
Construction Fund.
(2) In the case of other Project Costs (including
transfers to pay Bond service charges) the Trustee shall
disburse moneys in the Construction Fund from time to time
upon receipt by the Trustee of a requisition signed by the
Company Representative and approved by the Bank, if any,
which: (a) states with respect to each disbursement to be
made: (i) the requisition number; (ii) the name and address
of the Person to whom payment is due, which may be the
Company in the case of a requisition requesting
reimbursement for Construction Costs previously paid by the
Company; (iii) the amount to be disbursed; (iv) that each
obligation mentioned therein has been properly incurred, and
5-1
a proper charge against the Construction Fund and has not
been the basis of any previous disbursement; and (v) that at
least ninety percent (90%) of the amount of such
disbursement, together with all other disbursements
theretofore made from the Construction Fund, has been used
(a) for payment of amounts incurred after the official
Action Date, for the acquisition of land or property of a
character subject to the allowance for depreciation incurred
after the official Action Date, 'which are, for federal
income tax purposes, chargeable to the Project's capital
account or would be so chargeable either with a proper
election or but for a proper election to deduct such
amounts; and (b) specifies in reasonable detail the nature
of the obligation; and (c) is accompanied by a bill or
statement of account for each obligation.
Notwithstanding the foregoing, unless and until the
Alternate Security is in place, no disbursements may be made from
the Construction Fund other than an amount in excess of that
necessary as of any date of such calculation, to purchase
Eligible Investments which together with the income scheduled to
be received thereon (including discount or premium, if any) and
other funds available 'to the Trustee will provide funds and
revenues timely available to pay all Bond Service Charges to and
including September 15, 1986.
The Trustee shall be responsible for the safekeeping and
investment of the moneys held in the Construction Furry the
payment thereof in accordance with this Section, and the
application of amounts paid pursuant to such requisitions.
C. Transfers of Unexpended Proceeds. Upon the earlier of
(1) the Comp etion Date, or (2) three years after the Closing
Date, the Trustee shall retain in the Construction Fund such
amount as shall be specified in written notice filed with the
Trustee by the Company Representative to be required to pay
Construction Costs incurred but not as, yet paid, and the Trustee
shall withdraw and transfer to the Bond Fund the balance of
moneys in the Construction Fund. Thereafter all amounts so
retained in the Construction Fund but not subsequently used and
the notice of such failure of use of which shall be given by the
Company Representative to the Trustee, shall be transferred to
the Bond Fund and applied to redeem Bonds.
Upon filing with the Trustee of an opinion of Bond Counsel
to the effect that the tax-exempt status of the Bonds will not be
affected thereby, the Company may extend the three-year
construction period specified above with consent of the Issuer.
In that case, all references herein to that three-year period
shall be deemed expanded to such longer period.
5-2
Section 5.03. Bond Fund.
A. Establishment. The Trustee shall establish a special
fund designate as the "Bond Fund." There shall be deposited in
the Bond Fund all the moneys required by Section .5.01., any
transfers from the Construction Fund pursuant to Section 5.02(C)
and all Revenues and any other. moneys received by the Trustee for
deposit therein pursuant to the Agreement.
B. Application of Moneys. All amounts in the Bond Fund
shall be used and withdrawn by the Trustee solely for the purpose
of paying Bond service charges.
C. Drawing on Letter of Credit. If the Alternate Security
is an irrevocable direct-pay bank letter of credit, (i) the
Trustee shall on the Business Day on which a Company Note Payment
is due, draw on the Letter of Credit in an amount equal to' the
Company Note Payment then due, and (ii) an amount equal to any
redemption premium on the Bonds shall be drawn under the Letter
of Credit at least forty (40) days before the redemption date.
Draws on the Letter of Credit shall be deposited into the Bond
Fund and, subject to any reimbursement agreement with the Bank,
shall be considered payments by the Company.
D. Sinking Fund. The Sinking Fund is a subsidiary fund of
the Bond Fund to be established by the Trustee to provide for the
payment of the principal and accrued interest, if any, on the
Bonds at maturity pursuant to the following schedule:
Maturity (Year)
Principal Amounts
12/15/1989
115,000
12/15/1990
120,000
12/15/1991
130,000
12/15/1992
140,000
12/15/1993
155,000
12/15/1994
165,000
12/15/1995
180,000
12/15/1996
195,000
12/15/1997
210,000
12/15/1998
225,000
12/15/1999
245,000
12/15/2000
265,000
12/15/2001
285,000
12/15/2002
305,000
12/15/2003
330,000
12/15/2004
355,000
12/15/2005
385,000
12/15/2006
415,0,00
12/15/2007
450,000
12/15/2008
485,000
12/15/2009
525,000
12/15/2010
565,000
12/15/2011
610,000
5 -3
12/15/2012
660,000
12/15/2013
715,000
12/15/2014
770,000
Section 5004.
Investment of Funds.
A. Moneys in the Funds shall be invested by the Trustee in
the Initial Investments, which may not be withdrawn, transferred,
liquidated or sold prior to the earlier of the Alternative
Security Effective Date or the Mandatory Tender Date. At all
times thereafter, moneys in the Funds shall be invested and
reinvested by the Trustee in any Eligible Investments at the oral ,
(promptly confirmed in writing) or written direction theretey N,t
-ter--Tr t2&
or redeemabl-e as aforesaid
or-Writ-ten 4i*er i of the Company. Subject to any such
Wral directions with respect thereto, the Trustee may from time to
time sell such investments and reinvest the proceeds therefrom in
Eligible Investments maturing or redeemable as aforesaid. Any
such investments may be purchased from or sold to the Trustee or
any commercial bank affiliated with the Trustee. The Trustee
shall sell or redeem investments outstanding to the credit of the
funds to produce sufficient moneys applicable hereunder to and at
the times required for the purposes of paying Bond, service
charges when due, and shall do so without necessity for any order
on behalf of the Issuer and without restriction by reason of any
such- order. An investment made from moneys credited to a Fund
shall constitute part of that Fund and such Fund shall be
credited with all proceeds of sale from such investment. For
purposes of this Indenture, such investments shall be valued at
market value.
B. Prior to the Completion Date, all earnings on all Funds
shall be transferred to- the Construction Fund at least
semiannually and, thereafter, to the Bond Fund.
Anything to the contrary in this Section 5.04
notwithstanding, unless and until the earlier of September 15,
1986 or the date upon which Alternative Security is provided
hereunder, all amounts held under this Indenture, except those
permitted to be disbursed under Section 5.02(b), shall be
invested in Eligible Investments which together with the income
scheduled -to be received thereon (including discount or premium,
if any) and, other funds available in the Bond Fund will provide
funds and revenues timely available to pay all Bond Service
Charges.-to and including September 15, 1986, including any
Optional or Mandatory Tender then due and all income thereon
shall be deposited into the Bond Fund.
Section 5.05. Moneys to be Held in Trust. All moneys
required or permitte to be eposite wit or paid to the Trustee
or any Paying Agent under any provision of the Basic Documents,
and any investments thereof, shall be held by the Trustee or such
5-4
Paying Agent in trust and, except for moneys deposited with or
paid to the Trustee or any Paying Agent for the redem ti nand
Bonds, notice of the redemption of which has been duly given,
moneys. held by the Trustee pursuant to Section 5.07 s hereof,
shall, while held by the Trustee or Paying Agents,
the lien hereof.
In the event any
Section 5.06. Non resentment of Bonds.
Bond shall not be-presented or payment when the principal
thereof becomes due, either at maturity, at the date fixed for
redemption thereof, or otherwise, if funds sufficient to pay such Trustee
for
the Bond shall have bernthe made eof n all albiabilitytof t e Issuer to the
benefit of the holde
holder thereof for the payment of such Bond shall thereupon cease
and be completely discharged, and it shall be the duty of the
Trustee to hold -such funds, without liability for interest
thereon, in a separate account in the Bond Fund for the benefit
of -the holder of such Bond, who shall thereafter be restricted
n hi
onds
exclusively to such funds for on, orawith f rewhatever spect to atsa doB
part under this Indenture the Trustee
provided, that any funds which shall
hbe so older eof by Bond not the
and which remain unclaimed by the after such
presented for payment for a period of four (4) Years in
-due date thereof, shall be paid to the Company, upon request
writing by the Company, free of any trust or lien and thereafter
the holder of such Bond shall look only to the Company for so received payment ,and then only thereon aoun nd s the Trustee shalle havepano
without any interest
further responsibility with respect to such moneys.
Section 5.07. -Surplus Funds. As long as there is no Event
the Trustee shall on the day following
ef cult continuing,
of Default'
each Interest Payment Date, transfer to the Company any
investment -income on to moneys Fiduc iaries° various Funds
and expense so plus
extent (i) required pay Bond service charges
interest thereon, and (ii) necessary to pay
pursuant to the schedule attached to the Company Cost
Certificate. Except as provided in Section 5.06 hereof, any
amounts remaining in the Funds after all of dithe scharge n under othe
shall be deemed to have been paid and
provisions of this Indenture, and the fees, charges and expenses
plus interest thereon of the Fiduciaries and all other amounts
requited to be paid under the Basic Documents shall have been
paid,. shall be paid to the Company. Notwithstanding the
to SecurComity priorcto
foregoing, unless sndl~ be transferredAlternative
no Surplus Funds
September 15, 1986.
5 -5
ARTICLE VI
THE TRUSTEE, PAYING AGENTS AND AUTHENTICATING AGENTS
Section 6.01. Trustee's AcCe Lance and ResnonsI ilities.
The Trustee accepts the trusts imposed upon it y udent and agrees to perform those t trusts as an
but only upon a dnsubjectpto the
trustee under a trust greement
following express terms and conditions:
A. The Trustee may execute any of the trusts or powers
hereof and perform any of its duties by or through attorneys,
agents, receivers or employees but shall be answerable for the
conduct of the same in accordance with the standard specified
above, and shall be entitled to advice of counsel concerning all
all
matters of trusts hereof and duties hereunder, and may
cases pay reasonable compensation to all such atbteorneeys, agents,
receivers and employees as reasonably Tr ay may aemploe in
ct upon an
connection with the trusts hereof. The Opinion of Counsel approved by the Trustee in the exercise of
reasonable care. The Trustee shall not be responsible for any
loss or damage resulting rom any action taken or not taken in
good faith in reliance upon
B. Except for its certificate of authentication on the
Bonds, the Trustee shall not be responsible i any recital
recording
herein or in the Bonds, or for the validity, pr Y►
or re-recording, filing or re-filing of this Indenture o me of aof
Supplemental Indenture or the Mortgage, or any instrunt
further assurance, collateral
thereto or continuation ostatements,norcfor
statements, amendments t
ensuring the Project or collecting any the insurance
of th so Indenturefor
the validity of the execution by
of any supplements thereto or instruments of further assurance,
or for the sufficiency of the security for for the issued
hereunder or intended to be secured hereby, or value of
enterscurintity
the t evethe nt mthe enanceTrusteof the se
or title to the P hat c in or
hereof, except t
possession of a part or all of the Project pursuant to any
provision of the Mortgage or other instrument collateral thereto,
it shall use due diligence in preserving such property.
Trustee shall not be bound of ascertain or
conditions for
performance or observance art of the
agreements on the part of the Issuer or on the p
Company under the Agreement except as hereinafter set forth; but
but
of the tcomcovenantspany
the Trustee may require of the Issuer or
information and advice as to the performance
conditions and agreements. Except as otherwise provided in
Section 7.04 hereof, te of Trustee shall have the Issuer under theoAgree entl~n to
perform any of the duties
6-1
C. The Trustee shall not be accountable for the
application by the Bank other hereunder~f the proceeds of
any Bonds authenticated
D. The Trustee shall act upon any notice, request,
consent, certificate,, order, affidavit, letter, telegram or other
paper or document believed by it to be genuine and correct and ty
have been signed or sent by the proper person or persons.
action taken by the Trustee pursuant to this Indenture upon the
request or authority or consent of any Person who at the time of
making such request or giving such authority or consent is the upon all
holder of any Bonds,
the samel Bond and conclusive
Bonds dissued lnin exchange
future holders
therefor or in place thereof.
E. As to the existence or nonexistence of any fact for
which the Issuer may be responsible or as to the sufficiency or
validity of any instrument, report, paper or proceeding, the
Trustee shall be' entitled to rely upon a certificate signed on
behalf of the Issuer by an authorized officer thereof as
sufficient evidence of the facts therein contained, and,. prior to
the occurrence of a default of which the Trustee has been
notified as provided in paragraph (G) of this Section, or of
which by that paragraph it is deemed to have notice, may accept a
similar certificate to the effect that any particular dealing,
transaction or action is necessary or expedient, but may at its
discretion obtain such further evidence deemed necessary The
advisable, but shall in no case be bound to secure the same.
Trustee may accept a certificate of the officer, or an assistant
thereto, having charge of the appropriate records to the effect
that legislation in the form therein set forth has been enacted
full force such
and sl is in evidence
the Legislative
duly t adoptd conclusive
le and
i been Authority
legislation on has
effect.
F. The permissive right of the Trustee to do things
and
not.be as a negligence
enumerated Indenture shall
the Trustee
or willful default.
G. The Trustee shall -not be required to take notice or be
deemed to have notice of any default hereunder, except Events of
Default described in paragraphs (a), (b) and (d) of Section 7.01
hereof, unless the Trustee shall be specifically notified of such
default in writing delivered to it by the Issuer or by the
ate
holders of at least twenty-five percent (25%) in agg g
principal amount of Bonds then outstanding, and in the absence of
may conclusively assume
delivered, except the Trust
such notice
esaid.
there is no default
H. The Trustee shall not be personally liable for any
debts contracted, or for injury or damage to persons or to
personal property, or for salaries or nonf ulfillment of
contracts, relating to its possession or management of the
6-2
Project during any period in which it, may be,in possession of or
managing the Project pursuant to any provision of the Mortgage or
other instrument collateral thereto.
.I. At any and all reasonable times the Trustee, and its
duly authorized agents, attorneys, experts,- engineers,
accountants and representatives may inspect any and all books,
papers and records of the Issuer pertaining to the Project and
the Bonds, and may make such memoranda from and in regard thereto
as may be desired.
J. The Trustee shall not be required to give-any bond in
respect of the execution of those trusts and powers or otherwise
in respect of the premises.
K. Notwithstanding anything contained elsewhere in this
Indenture, the Trustee may, but shall not be-required to, demand
in respect of the authentication of any Bonds or any action
whatsoever within the purview of this Indenture, any showings,
certificates, reports, opinions, appraisals or other information,
or corporate action or evidence thereof, in addition to that
required by the terms hereof as a condition of such action by the
Trustee, deemed by it desirable for the purpose of establishing
the. right of the Issuer to the authentication of any Bonds or the
taking of any other action by the Trustee.
L.. Before taking action under Article VII or Section 6.03
hereof, -the Trustee may require that a satisfactory indemnity
bond be furnished by the Company for the reimbursement of all
expenses to' which it may be put and to protect it against all
liability, except liability which is adjudicated to have 'resulted
from its negligence or willful default, by reason of any action
so taken. The Trustee may take such action without such
indemnity, and in such case the Bank shall reimburse the Trustee
for all such expenses pursuant to Section 6.02 hereof.
M. Unless otherwise provided herein, all moneys received
by the Trustee under this Indenture,, until used or applied or
invested as herein provided, shall be held' in trust for the
purposes of which they were received but need not be segregated
from other funds except to the extent required by this Indenture
or by law.
N. Any legislation by the Legislative.Authority, opinions,
certificates and other instruments provided for in this Indenture
may. be accepted by the Trustee as conclusive' evidence of the
facts and conclusions stated therein and shall be full warrant,
protection and authority to the Trustee for its actions taken
hereunder.
6-3
! •
0. The Trustee, Paying Agents and Authenticating Agents,
and any of their directors, officers, employees or'agents, may in
good faith become the owners of Bonds secured hereby with the
same rights which it or they would have hereunder if the Trustee,
Paying Agents or Authenticating Agents were not such.
P. Nothing herein shall relieve the Trustee from liability
for its own willful or grossly negligent conduct.
Section 6.02. Fees, Charges and Expenses of the
Fiduciaries. The Trustee shall be entitled to payment or
reim ursement from moneys in the Bond Fund not required for
payment of Bond service charges or, to the extent not available
therein, by the Company pursuant to the Agreement for reasonable
fees for its ordinary Services rendered hereunder and all
advances, counsel fees and other Ordinary Expenses reasonably and
necessarily paid or incurred by the Trustee in connection with
such Ordinary Services and, in the event that it should become
necessary that the Trustee perform Extraordinary Services, it
shall be entitled to reasonable extra compensation therefor, and
to reimbursement for reasonable and necessary Extraordinary'
Expenses in connection therewith; provided, however, the Company
may in good faith contest, without creating a default hereunder,
the necessity for any such Extraordinary Services and
Extraordinary Expenses and the reasonableness of any such fees,
charges or expenses and, furthermore, if such Extraordinary
Services or Extraordinary Expenses are occasioned by the neglect
or misconduct of the Trustee, the Trustee shall not be entitled
to compensation or reimbursement therefor. Other Fiduciaries
shall be entitled to payment and reimbursement, but only from the
sources specified above, for their reasonable fees and charges.
Section 6.03. Intervention by Trustee. In any judicial
proceeding to which the Issuer, the Bank, the Company, .or any
Fiduciary other than the Trustee, is a party and which in
ubst tial bearing on the
substantial
of the Trustee and its attorney has a
interests of holders of the Bonds,, the Trustee may seek to
intervene on behalf of the Bondholders and shall do so if
requested in writing by the holders of at least twenty-five
percent (25%) of the aggregate principal amount of Bonds then
outstanding.
Section 6.04. Successor Trustee. Any corporation or
association into which t e Trustee may be converted or merged, or
with which it or any successor to it may be consolidated, or to
which it may sell or transfer its assets and trust business as a
whole or substantially as a whole, or any corporation or
association. resulting from any such conversion,- sale, merger,
consolidation or transfer to which it is a party, ipso facto,
shall be and become successor Trustee hereunder and vested ' with
all trusts, powers, duties, discretions, immunities, privileges
and all other matters as was its predecessor, without the
further to on the
execution or filing any sthereto, or-any
the
part of any parties
6-4
contrary notwithstanding; provided that any such successor
Trustee shall be a corporate trust company or a bank or a banking
association having the powers of a trust company in good
standing, within or without the State but authorized to exercise
trust powers within the State and having a reported capital and
surplus of not less than $50 million.
Section 6.05. Appointment of Co-Trustee. It is the purpose
of this indenture that there shall be no violation of any law of
any jurisdiction (including particularly the laws of the State),
denying or restricting the right of banking corporations or
associations to transact business as trustee in such
jurisdiction. It is recognized that in case of litigation under
this Indenture or other documents relating to the Bonds and the
Project, and in particular in case of the enforcement thereof on
default, or in the case the Trustee deems that by reason of any
present or future law of any jurisdiction it may not exercise any
of the powers, rights or remedies herein granted to the Trustee
or hold title to the properties, in trust, as herein granted, or
take any action which may be desirable or necessary in connection
therewith, it may be necessary that the Trustee appoint an
individual or additional institution as a separate or co-trustee.
The following provisions of this Section are adapted to these
ends.
In the event that the Trustee appoints an individual or
additional institution as a separate or co-trustee, each and
every .remedy, power, right, claim, demand, . cause of action,
immunity, estate, title, interest and lien-expressed or intended
by this Indenture to be exercised by or vested in or conveyed to
the Trustee with respect thereto shall be exercisable by and vest
in such separate or co-trustee but only to the extent necessary
to enable such separate or co-trustee to exercise such powers,,.
rights and remedies, and every covenant and obligation necessary
to the exercise thereof by such separate or co-trustee shall run
to and be enforceable by either of them.
Should any instrument in writing from the Issuer be
reasonably required by the separate or co-trustee so appointed by
the Trustee for more fully and certainly vesting in and
conforming to him or if such properties, rights, powers, trusts,
duties and obligations, any and all such instruments in writing
shall, on request, be executed, acknowledged and delivered, but
not prepared, by the Issuer. In case any separate or co-trustee
or a successor to either shall die, become incapable of acting,
resign or be removed, all the estates, properties, rights,
powers, trusts, duties and obligations bof shasuch ll separate or
in and co-
trustees, so far as permitted by law,
trustees,,
exercised by the Trustee until, the appointment of a successor to
such separate or co-trustee.
Section 6.06. Resignation by the Trustee. Subject to
Section 6.07 hereof,, the Trustee may at any time resign from the
trusts hereby created by giving written notice thereof to the
6-5
•
issuer, the Bank and the Company not less than sixty (60) days
before the resignation is to take effect, and by mailing written
notice of such resignation by first class mail, postage prepaid,
to the Bondholders as their names and addresses appear on the
Bond Register, not less than forty-five (45) days before such
resignation is to take effect.. However, such resignation shall
take effect immediately upon the appointment of a successor
Trustee if the successor Trustee is appointed and accepts the
trusts hereof before the time stated in that notice.
Section 6.07. Removal of the Trustee. The Trustee may be
removed at any time by (i) an instrument or concurrent
instruments in writing delivered to the Trustee, to the Issuer,
the Bank and the Company, and signed by or on behalf of the
holders of not less than a majority in aggregate principal amount
of Bonds then outstanding or (ii) by an instrument delivered to
the Trustee and all Bondholders signed by the Issuer, Company,
and the Bank.
Notwithstanding anything else herein, no removal or
resignation of the Trustee shall be effective until a successor
Trustee is duly appointed hereunder and has accepted such
appointment.
Section 6.08. Appointment of Successor Trustee. In case
the Trustee hereunder shall resign or be removed, or be
dissolved, or otherwise become incapable of acting hereunder, or
in case it shall be taken under the control of any public officer
or officers, or of a receiver appointed by a court, a successor
shall be appointed by the Issuer with the written consent of the
Bank and the Company; provided that if a successor Trustee is not
so appointed within ten (10) days after notice of resignation is
mailed or instrument of removal is delivered as provided in
Section 6.06 and 6.07 hereof, respectively, or the Trustee is
dissolved, taken under control or otherwise incapable of action
as above provided, then the holders of a majority in aggregate
principal amount of Bonds then outstanding, by an instrument or
concurrent instruments in writing signed by or on behalf of such
holders, may designate a successor Trustee. Each such successor
Trustee appointed pursuant to this Section shall be a corporate
trust company or bank or banking association in good standing,
within or without the State but duly authorized to exercise trust
powers within the State, having a reported capital and surplus of
not less than $50 million, and willing to accept the trusteeship
under the terms and conditions of this Indenture.
Every successor Trustee appointed hereunder shall execute,
acknowledge and deliver to its predecessor and also to the
Issuer, the Bank and the Company, an instrument in writing
accepting such appointment hereunder, and thereupon such
successor without any further act shall become fully vested with
all the rights, powers, trusts, duties and obligations of its
predecessor. The predecessor Trustee shall on the written
request of its successor or of the issuer, execute and deliver an
6-6
(FORM OF ASSIGNMENT)
Assignment
For value received, the urn
and transfers unto
hereby irrevocably constitute an
attorney to transfer the said
registration of the within Bond,
in the premises.
dersigned hereby sells, assigns
the within Bond and does
appoint
Bond on the books kept for
with full power of substitution
Dated:
Signature Guaranteed:
Notice: The assignor's signature to this assignment must
correspond with the name as it appears upon the face of
the within Bond in every particular, without alteration
or any change whatever.
A-12
0 0
instrument transferring to the successor Trustee all the estates,
properties, rights, powers and trusts of the predecessor Trustee
hereunder, and shall duly assign, transfer and deliver all
property, securities and moneys held by it as Trustee to its
successor. Should any instrument in writing from the Issuer be
and anudties certainly
required by any successor Trustee for molders fully
vesting in that successor the rights, po d hereby
vested or intended to be vested in the predecessor, any and all
such instruments in writing shall, on request, be executed,
acknowledged and delivered by the Issuer.
In the event of a change in Trustee, the predecessor Trustee
which has resigned or been removed shall cease to be custodian of
any funds it may hold pursuant to this indenture, and cease to
the extent that it was such, to be Bond Registrar, Paying Agent
and Authenticating Agent for any of the Bonds, and the successor
Trustee shall become such custodian, Bond Registrar, Paying Agent
and Authenticating Agent.
Section 6.09. Adoption of Authentication. In case any of
the Bonds shall have een aut enticate ut not delivered, any
successor Trustee may adopt the certificate of authentication of
the original Trustee or of any successor of it as Trustee
hereunder and deliver those Bonds so authenticated as
hereinbefore provided; and, in case any of such Bonds shall not
have been authenticated, any successor Trustee may authenticate
such Bonds either in the name of any predecessor or in its own
name. In all such cases the certificate of authentication shall
have the same force and effect as provided in the Bonds or in
this Indenture with respect to the certificate of authentication
of the Trustee.
Section 6.10. Designation and Succession of Authenticating
andp wing Agents. T e Trustee an any other an s or trust
companies designated as Paying Agent or Agents or Authenticating
Agent or Agents, as the case may be, in the Bond Resolution shall
be the Paying Agent or Agents or Authenticating Agent or Agents
for the Bonds and, in the absence of such designation, the
Trustee shall be the sole paying Agent and Authenticating Agent.
If the position of Paying Agent or Authenticating Agent
shall become vacant for any reason, the Issuer shall,, within
thirty (30) days thereafter, appoint a bank or trust company
located in the same city as such Paying Agent or Authentici t na
Agent to fill such vacancy. If the Issuer fails to appo
successor Paying Agent or Authenticating Agent within that
period, the Trustee shall make the appointment.
For all purposes of this Indenture, the authentication and
delivery o be Bonds by an
as effective as ifcs such Bonds nhad been delivered
Trustee shall
and authenticated by the Trustee.
6-7
•
Section 6.11. Fiduciary Protection. Fiduciaries other than
the Trustee shall enjoy the same protective provisions in the
performance of their duties hereunder as are specified in Section
6.01 hereof with respect to the Trustee, insofar as such
provisions may be applicable.
6-8
9
ARTICLE VIZ
0
DEFAULT PROVISIONS AND REMEDIES
OP TRUSTEE AND BONDHOLDERS
Section 7.01. Defaults: Events of Default. The occurrence
of any of the following events, subject to the provisions of this
Article VII, is hereby defined as and declared to be and to
constitute an Event of Default hereunder:
(a) Failure in the payment of any interest on any Bond
when and as the same shall have become due and payable.
(b) Failure in the payment of the principal of or any
premium on any bond when and as the same shall become due
and payable, whether at stated maturity or upon
acceleration, redemption or otherwise.
(c) Failure by the Issuer to perform or observe any
other covenant, agreement or condition on the part of the
Issuer contained in this Indenture or in the Bonds, which
failure or default shall have continued for a period of
sixty (60) days after written notice, by registered or
certified mail, to the Issuer, the Bank and the Company
specifying the failure or default and requiring the same to
be remedied, which notice may be given by the Trustee in its
discretion and which notice shall be given by the Trustee at
the written request of the holders of not less than twenty-
five percent (25%) in aggregate principal amount of Bonds
then outstanding.
(d) The commencement by the Issuer of proceedings
under Title 11 of the United States Code, or the consent, by
answer or otherwise, to such filing against 'the Issuer, or
the involuntary commencement against the Issuer of such
proceedings, if not dismissed, enjoined, or halted within
sixty (60) days.
(e) Failure to make payment of the amount, if any, due
pursuant to Section 13.01 hereof when due.
(f) Failure to perform or observe any covenants of the
Issuer or Company under Section 10.01 hereof.
The term "default" as used in this Article means default by
the Issuer in the performance or observation of any of the
covenants, agreements or conditions on its part contained in this
Indenture or in the Bonds, exclusive of any period of grace
required to constitute a default or Event of Default as provided
above or in the Agreement.
7-1
Section 7.02. Notice if Default occurs. If an Event of
Default shall occur, the Trustee shall, within five (5) days
after knowledge of such Event of Default (immediately innot case
of default under subsections (a) and (b)), give written
the Event of Default, (a) by registered or certified mail to the
Issuer, the Company and the Bank and (b) by first class mail to
the holders of all bonds 'hen outstanding as shown by the
registration books maintained pursuant to Section 3.06 hereof.
Section 7.03. Acceleration.
A. Declaration. Upon the occurrence of any Event of
Default (ot er than as defined in paragraph (c) of Section 7.01),
the Trustee may, and upon the written request of the holders of
not less than twenty-five percent (25%) in aggregate principal
amount of Bonds then outstanding the Trustee shall, by notice in
writing delivered to the Issuer, declare the principal of and any
premium on all Bonds then outstanding (if not then due and
payable) and the interest accrued thereon to be due and payable
immediately, and, upon such declaration, that principal and
premium, if any, and interest shall become and be immediately due
and payable. Interest on the Bonds shall accrue to the date
determined by the Trustee for the tender of payment to the
Bondholders pursuant to such declaration. The Trustee shall
immediately draw moneys under any Security Alternate Security
the
to the extent available thereunder to pay the principal
Bonds and interest accrued on the Bonds pursuant to the previous
sentence.
B. Annulment. Subject to the immediately succeeding
sentence, at any time after the principal of the Bonds shall have
been so declared to be due and payable and before the entry.of
final judgment or decree in any suit, action or proceeding
instituted on account of such default, or before the completion
of the enforcement of any other remedy hereunder, the Trustee
may, with the consent of holders of a majority in aggregate
principal amount of Bonds outstanding,.annul such declaration and
its consequences with respect to any Bonds not then due by their
terms, which Annulment shall be binding on all Bondholders if (i)
moneys shall have been deposited in the Bond Fund sufficient to
pay all matured installments of Bond service charges then due
(other than the principal then due only- because of such
declaration) of all Bonds outstanding; (ii) moneys shall have
been deposited with Trustee sufficient to pay the charges,
compensation, expenses, disbursements, advances and liabilities
of the Fiduciaries; (iii) all other amounts then payable. by the
Issuer hereunder shall have been paid or a sum sufficient to pay
the same shall have been deposited with the Trustee; (iv) every
other default (other than a default in the payment of the
principal of such Bond then due only because of such declaration)
shall have been remedied to the satisfaction of the Trustee; and
(v) the Trustee has received the express prior written consent of
the Bank to the Annulment of such declaration and written notice
from the Bank that the Security or Alternate Security has been
7-2
reinstated to the amount covered thereby immediately preceding
such declaration. The Trustee shall not annul any declaration if
the Security or Alternate Security is in effect at the time of
such declaration and if, prior to Annulment of such declaration,
sufficient moneys are drawn under the Letter of Credit to pay the
Bonds -in full on the date the Boards are to be paid. No such
Annulment shall extend to or affect any subsequent Event of
Default or impair any right consequent thereon.
Section 7.04. other Remedies; Rights 'of Bondholders. Upon
the happening and continuance of an Event of Default the Trustee
may, with or without taking action under Section 7.03 hereof,
pursue" any available -remedy to enforce the payment -of Bond
service charges or the performance of or compliance with any
other obligation or requirement of the Basic Documents.
Upon the happening and continuance of an Event of Default,
and if requested-'so to-do-by the holders of at least twenty-five
percent (25%) in aggregate principal amount of Bonds then
outstanding, the Trustee shall, subject to the provisions of
Section 6.01 and particularly subparagraph (L) of that section,
exercise such of the rights and powers conferred by this Section
and Section 7.03 hereof as the Trustee, being advised by counsel,
shall deem most effective to enforce and protect the interests of
the Bondholders.
No remedy of the terms of this Indenture conferred upon or
reserved to the Trustee (or to the Bondholders) is intended to be
exclusive of any other remedy, but each and every such remedy
shall be cumulative.and shall be in addition to any other remedy
given to the Trustee or to the Bondholders hereunder or now or
hereafter existing.
No delay or omission to exercise any right or power accruing-
upon any default or Event of Default shall impair any such right
or power or shall be construed to be a waiver of any such default
or Event of Default or acquiescence therein; and every such right
and power may be exercised from time to time and as often as may
be deemed expedient.
The Trustee, shall npunder the eBasice Documents. each and every
right granted to the issuer
exercising such rights and the rights given the Trustee under
this Article, the Trustee shall take such action as, in the
judgment of the Trustee, applying the standards described in
Section 600.1 hereof, would best serve the interests of the
Bondholders.
Section 7.05. Right of Bondholders to Direct Proceedings.
Anything in this Indenture to the contrary notwithstanding, the
holders of a majority in aggregate principal amount of Bonds then
outstanding shall have the right at any- time, by an instrument or
instruments in writing executed and delivered to the Trustee, to
direct the method and place of conducting all proceedings to be
7-3
taken in connection with the enforcement of the terms and
conditions of this Indenture or any other proceedings hereunder;
provided, that (i) such direction shall not be otherwise than in
accordance with the provisions of law and of this Indenture, (ii)
the Trustee shall be indemnified as provided in Section 6.01 and
(iii) the Trustee may take any other action deemed proper by the
Trustee which is"not inconsistent with such direction.
Section 7.06. Application of Moneys. Af ter payment of the
costs, expenses, liabilities and vances incurred or made by the
Trustee in the collection thereof (including, without limitation,
reasonable attorneys' fees and expenses except as may be limited
by law or judicial order or decision entered in any action taken
under this Article), all moneys received by the Trustee pursuant
to any right given or action taken under the provisions of this
Article, if any, subject to any provision made pursuant to
Sections 4.05 or 5.05 hereof, shall be applied as follows:
(a) Unless the principal of all the Bonds shall have
become or have been declared due and payable, all such
moneys shall be deposited in the Bond Fund and shall be
applied:
First - to the payment to the persons entitled
thereto of all installments of interest then due on the
Bonds, in the order of the dates of maturity of the
installments of that interest and beginning with the
earliest such date and, if the amount available h particular
not be sufficient to pay in full any P
installment, then to the payment thereof ratably
accorded to the amounts due on such installment to the
persons entitled thereto, without any discrimination or
privilege except as to any difference in the respective
rates of interest specified in the Bonds; and
Second - to the payment to the persons entitled
thereto of the unpaid principal of any of the Bonds
which shall have become due (other than Bonds
previously called for redemption for the payment of'
which moneys are held pursuant to the provisions of
this Indenture), whether at maturity or by call for
redemption, in the order of their due dates and-
beginning with the earliest such due date, with
interest on such Bonds from the respective dates upon
which they became due, and if the, amount available
shall not be sufficient to pay in full all Bonds due on
any particular date, together with such interest, then
to the payment thereof ratably, according to the amount
of principal due on such date, to,the person entitled
thereto without any discrimination or privilege.
(b) If the principal of. all the Bonds shall have
become due or shall have been declared due and payable
pursuant to this Article, all such moneys shall be deposited
7-4
into the Bond Fund and shall be applied to the payment of
the principal and interest then due and unpaid upon the
Bonds, without preference or priority of principal over
interest or of interest over principal, or of any
installment of interest over any other installment of
interest, or of any Bond over any other Bond, ratably,
according to the amounts due respectively for principal and
interest, to the persons entitled thereto without any
discrimination or privilege except as to any difference in
the respective rates of interest specified in the Bonds.
(c) if the principal of all the Bonds shall have been
declared due and payable pursuant to this Article, and if
that declaration shall thereafter have been rescinded and
annulled under the provisions of Section 7.03 or 7.10
hereof, then, subject to the provisions of paragraph (b) of
this Section in the event that the principal of all the
Bonds shall later become due and payable, the moneys shall
be deposited into the Bond Fund and shall be applied in
accordance with the provisions of paragraph (a) of this
Section.
Whenever moneys are to be applied pursuant to the provisions
of this Section, those moneys shall be applied at such times, dand
ue
from time to time, as the Trustee shall determine, having
regard to the amount of such moneys available for application and
the likelihood of additional moneys becoming available for such
application in the future. Whenever the Trustee shall direct the
application of those moneys, it shall fix the date upon which the
application is to be made and upon such date interest on the
amounts of principal to. be paid on such dates, and for which
moneys are available, shall cease to accrue. The Trustee shall
give such notice as it may deem appropriate of the deposit with
it of any moneys and of the fixing of any such date consistent
with the requirements of Section 3.05 hereof for the
establishment of, and notice with respect to, a Special Record
Date for the payment of interest in default. The Trustee shall
not be required to make payment of principal of and premium, if
any, on any bond to the holder thereof
appropriate until ensuch Bond dorsement shall for
presented to the Trustee for cancellation if fully paid.
Whenever all Bonds and interest thereon have been paid under
the provisions of this Section and all expenses and charges of
the Fiduciaries and all other expenses payable under the Basic
Documents have been paid, any balance remaining in the Bond Fund
1 court of Section 5.6 ereof
shall b paid
by finale order not
direction by a
subject to appeal.
Section 7.07. Remedies Vested in Trustee. All rights of
action (including the right to file proof o claims) under this
Indenture or under any of the Bonds may be enforced by the
Trustee without the possession of any of the Bonds or the
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production thereof , in any trial or other, proceeding relating
thereto. Any suit or proceeding instituted by the Trustee shall
be brought in its name as Trustee without the necessity of
joining as plaintiffs or defendants any holders of the Bonds.
Any recovery of judgment shall be for the benefit of the holders
of the outstanding Bonds, subject to the provisions of this
Indenture.
Section 7.08. Rights and Remedies 'of Bondholders. No
holder of any Bond s al have any right to 'institute any suit,
action or proceeding for the enforcement of this Indenture, for
the execution of any trust hereof or any other remedy hereunder,
unless (i) an Event of Default has occurred and is continuing, of
which the Trustee has been notified as provided in paragraph (G)
of Section 6.01 hereof, or of which by said paragraph it is
deemed to have notice, (ii) the holders of at least twenty-five
percent (25%) in aggregate principal amount of Bonds then
outstanding shall have made written request to the Trustee and
shall have afforded the Trustee reasonable opportunity to proceed
to exercise the powers hereinbefore granted or to institute such
action, suit or proceeding in its own name and shall have offered
to the Trustee indemnity as provided in Section 6.01 hereof, and
(iii) the Trustee shall thereafter have failed or refused to
exercise the powers granted herein or to institute such action,
suit or proceeding in its own name. That notification, request
and, offer of indemnity are in every case, at the option of the
Trstee, conditions precedent to the execution of the powers and
trusts of this Indenture, and to any action or cause of action
for the enforcement of this Indenture, or for any other remedy
hereunder.
It is understood and intended that no one or more holders of
the Bonds shall have any right in any manner whatsoever to
affect, disturb or prejudice the security or benefit of this
Indenture -by its or their action or to enforce any right
hereunder except in the manner herein provided and that
proceeding shall be instituted, had and maintained in the manner
herein provided and for the benefit of the holders of all Bonds
then outstanding. Nothing in this Indenture, however, shall
affect or impair the right of any Bondholder to enforce the
payment of the principal of and premium, if any, and interest on
any Bond owned by that holder when due and payable at the place,
from the sources and in the manner in that Bond expressed.
Section 7.09. Termination of Proceedin s. In case the
Trustee shall have proceeded to enforce any right under this
Indenture, and those proceedings shall have been discontinued or
abandoned for any reason, or shall have been determined adversely
to it, then and in every such case the Issuer, the Trustee and
the Bondholders shall be restored to their former positions and
rights hereunder, respectively, and all rights, remedies and
powers of the Trustee shall continue as if no such proceedings
had been taken.
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Section 7.10. Waivers of Events of Default. The Trustee at
any time in its discretion may waive any Event of Default
hereunder and shall do so upon the written request of the holders
of at, least a majority in aggregate principal amount of all the
Bonds then outstanding in respect of which an Event of Default in
the payment of Bond service charges exists. However, there shall
not be so waived any Event of Default described in paragraph (a)
or (b) of Section 7.01 hereof unless at the time of waiver
payments of the amounts provided in Section 7.03 hereof have been
made or provided for. In case of any such waiver or in case any
proceeding taken by the Trustee on account of any such Event of
Default shall have been discontinued or abandoned or determined
adversely to it, then and in every such case the Issuer, the
Trustee and the Bondholders shall be restored to their former
positions and rights hereunder. No such waiver shall extend to
any subsequent or other Event of Default or impair any right
consequent thereon.
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ARTICLE VIII
SUPPLEMENTAL INDENTURES: AMENDMENTS TO DOCUMENTS
Section 8.01. Supplesenta]l Indentures Generally. The
Issuer and the Trustee may enter into i entures supplemental to
this Indenture as provided in this Article and pursuant to the
other provisions therefor in this Indenture.
Section 8.02. Supplemental Indentures Not Requiring Consent
of Bondholders. The Issuer an the Trustee may without the
consent o , or notice to, any of the Bondholders, enter into
indentures supplemental to this Indenture which shall not, in the
opinion of the Issuer and the Trustee, be inconsistent with the
terms and provisions hereof for any one or more of the following
purposes:
(a) To cure any ambiguity, inconsistency or formal
defect or omission in this Indenture;
(b) To grant to or confer upon the Trustee for the
benefit of the Bondholders any additional rights, remedies,
powers or authority that lawfully may be granted to or
conferred upon the Bondholders or'the Trustee;
(c) To assign additional revenues under this
Indenture;
(d) To accept additional security and instruments of
further assurance with respect to the Project;
(e) To add to the covenants' and agreements of the
Issuer contained in the Indenture other covenants and
agreements thereafter to be observed for the protection of
the Bondholders, or to surrender or limit any right, power
or authority reserved to or conferred upon the Issuer in
this Indenture;
(f) To evidence any succession to the Issuer and the
assumption by such successor of the covenants and agreements
of the issuer contained in this Indenture, the Agreement and
the Bonds;
(g) To permit the exchange of Bonds, at the option of
the holder or holders thereof, for coupon Bonds payable to
bearer of the same series in an aggregate principal amount
not exceeding the unmatured and unredeemed principal amount
of such Bonds and bearing interest at the same rate or rates
and maturing on the same date or dates, with coupons
attached representing all unpaid interest due or to become
due thereon if, in the opinion of Bond Counsel selected by
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the Trustee, such exchange would not adversely affect the
excludability from federal income taxation of interest on
the Bonds.
(h) To permit qualification of the Indenture.under the
Trust Indenture Act of 1939, as amended.
(i) To modify, amend, alter or supplement the
Indenture in any other respect not materially adverse to the
Bondholders in the Trustee's sole opinion, including any
change necessary in the opinion of Bond Counsel to comply
fully with all applicable law promulgated or proposed by the
Department of the Treasury or the IRS pertaining to
obligations issued under the Code Section.
(j) To modify, amend, alter or supplement the
Indenture to obtain or maintain the rating of the highest
investment grade, whether or not inconsistent with the terms
and provisions hereof.
Section 8.03. Supplemental Indentures Requiring Consent of
Bondholders. Exclusive o Supp ement In entures referred to
Section 8.52 hereof and' subject to the terms and provisions and
limitations contained in this Section, and not otherwise, the
Issuer and the Trustee, with the consent of the holders of not
less than sixty-six and two-thirds percent (66-2/3%) in aggregate
principal amount of the Bonds at the time outstanding, evidenced
as in this Indenture provided, may execute Supplemental
Indentures adding any provisions to or changing in any manner or
eliminating any of the provisions of this Indenture or any
Supplemental Indenture or restricting in any manner the rights of
the holders of the Bonds. However, nothing in.this Section or
Section 8.02 hereof shall permit, or be construed as permitting
(a) without the consent of the holder of each Bond so affected,
(i) an extension of the maturity of the principal of or the
interest on any Bond, or (ii) a reduction in the principal amount
of any Bond or the rate of interest or premium thereon, or (iii)
a reduction in the amount or extension of the time of payment of
any mandatory sinking fund requirements (if any are shown on the
Bond form), or (b) without the consent of the holders of all
Bonds then outstanding, (i) the creation of a privilege or
priority of any Bond or Bonds over any other Bond or Bonds, or
(ii) a reduction in the aggregate principal amount of the Bonds
required for consent to such Supplemental Indenture.
If at any time the Issuer shall request the Trustee to enter
into any Supplemental Indenture for any of the purposes of this
Section, the Trustee shall, upon being satisfactorily indemnified
with respect to expenses, cause notice of the proposed execution
of such Supplemental Indenture to be mailed by first class mail,
postage prepaid, to all holders of Bonds then outstanding at
their addresses as they appear on the Bond Register. The Trustee
shall not be subject to any liability to any Bondholder by reason
of its failure to mail, or the failure of such Bondholder to
8-2
receive, the notice required by this Section, and any such
failure shall not affect the validity of the Supplemental
Indenture when consented to and approved as provided in this
Section. Such notice shall briefly set forth the nature of the
proposed Supplemental Indenture and shall state that copies
thereof are on file at the corporate trust office of the Trustee
for inspection by all Bondholders.
If within a period of not less than sixty (60) days but not
exceeding one (1) year, as shall be prescribed by the Issuer,
following the mailing of such notice, the Trustee shall receive
an instrument or instruments purporting to be executed by the
holders of not less than sixty-six and two-thirds percent (66-
2/3$) in aggregate principal amount of the Bonds then outstanding
which instrument or instruments shall refer to the proposed
Supplemental Indenture described in such notice and shall
specifically consent to and approve the execution thereof in
substantially the form of the copy thereof referred to in such
notice as on file with the Trustee, thereupon, but not otherwise,
the Trustee shall execute such Supplemental Indenture in
substantially that form, without liability or responsibility to
any holder of any Bond, whether or not that holder shall have
consented thereto.
Any such consent shall be binding upon the holder of the
Bond giving such consent and upon any subsequent holder of such
Bond and of any Bond issued in exchange therefor (whether or not
such subsequent holder thereof has notice thereof). However, the
consent may be revoked in writing by the holder of the Bond who
gave such consent or by a subsequent holder thereof by filing
such revocation with the Trustee prior to the execution by the
Trustee of the Supplemental Indenture. At any time after the
holders of the required percentage of Bonds shall have filed
their consents to the Supplemental Indenture, the Trustee shall
make and file with the Issuer a written statement that the
holders of such required percentage of Bonds have filed such
consents. That written statement shall be conclusive that such
consents have been so filed.
If the holders of the required percentage in aggregate
principal amount of the Bonds outstanding have consented to and
approved the execution thereof as provided in this Section, no
holder of any Bond shall have any right -to object to the
execution of the Supplemental Indenture, or to object to any of
the terms and provisions contained therein or the operation
thereof, or in any manner to question the propriety of the
execution thereof, or to enjoin or restrain the Trustee or the
Issuer from executing the same or from taking any action pursuant
to the provisions thereof.
Section 8.04. Consent of Com an , Bank and Fiduciaries.
Anything herein to t e contrary notwithstanding, a Supplemental
Indenture under this Article VIII which affects adversely any
rights of the Company, Bank or any Fiduciary shall not become
8-3
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effective unless and until the affected party shall have
consented in writing to the execution and delivery of such
Supplemental Indenture and no Supplemental Indenture may become
effective without the Bank's consent. In this .regard, the
Trustee shall cause notice of the proposed execution and delivery
of any Supplemental Indenture together with a copy of the
proposed Supplemental Indenture to be mailed as provided in
Section 11.04 hereof to the Company, Bank and each Fiduciary at
least ten (10) days before the date of its proposed execution and
delivery in the case of a Supplemental Indenture referred to in
Section 8.02 hereof, and not later than five (5) days after the
giving of the notice of the proposed execution and delivery in
the case of a Supplemental Indenture provided for in Section 8.03
hereof.
Section 8.05. Authorization to Trustee; Effect of
Supplement. The Trustee is authorized to loin with the Issuer in
the execution of any -Supplemental Indenture provided for-in this
Article and to make the further agreements' and stipulations which
may be contained therein. Any Supplemental Indenture executed in
accordance with the provisions of this Article..shall thereafter
form a part of this- Indenture; all the terms and conditions
contained in any such Supplemental Indenture as to any provision
authorized to be contained therein shall be deemed to be part of
the terms and conditions of this Indenture for any and all
purposes; this Indenture shall be and be deemed to be modified'
and amended in accordance. therewith; and the respective rights,
duties and obligations under this Indenture 'of the Issuer, the
Company,'the Hank, the Fiduciaries, and all holders of Bonds then
outstanding shall thereafter be determined, - exercised and
enforced hereunder, subject in all respects to such modifications
and-amendments. Express reference to such executed Supplemental
Indenture may be made in the,text of any Bonds issued thereafter,
if deemed necessary to.desirable by the Trustee or the Issuer.
Section 8.06. Opinion of Counsel. The Trustee shall be
entitled to receive, an shall be ully protected in relying
upon, an opinion of Counsel as conclusive evidence that any
proposed. Supplemental Indenture complies with the provisions of
this Indenture, and that it is proper for the Trustee, under the
provisions of this Article, to join in the execution of that
Supplemental Indenture.
Section 8.07. Modification by Unanimous Consent.
Notwithstanding anything contained elsewhere in'this Indenture,
the rights and obligations of the Issuer and of the holders of
the Bonds, and the terms and provisions of the Bonds and this
Indenture or any Supplemental Indenture, may be modified-,or
altered in any respect with the consent of the Issuer and of the
holders of all of the Bonds then outstanding and, if required by
Section 8.04 hereof, with the consent of the affected party.
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Section 8.08. Amendments to Basic Documents Not Requiring
Consent of Bondholders. The Issuer and the Trustee may, without
t He consent o or notice to the Bondholders, consent to any
amendment, change or modification of the Basic Documents other
than the Indenture as may be required, (i) by the provisions of
the Basic Doc=ents, (ii) for the purpose of curing any
ambiguity, inconsistency or formal defect or omission in the
Basic Documents, or (iii) in'-connection with any other change
therein which, in the judgment of the Trustee,_ is not to the
prejudice of the Trustee or the holders of the Bonds provided the
Bank consents thereto, including any change necessary in the
opinion of Bond Counsel to comply fully with applicable law
promulgated or proposed by the Department of the Treasury or the
IRS pertaining to obligations issued pursuant to the Code
Section.
Section 8.09. Amendments to Basic_ Documents Requiring
Consent of Bondholders. Except for the amendments, changes or
modifications as provided in Section 8.08 hereof, neither the
Issuer nor the Trustee shall consent to (i) any amendment, change
or modification of the Basic Documents which would change the
amount or time as of which Loan payments are required to be made
without the giving of notice or provided in this Section of such
proposed amendment, change or modification and receipt of the
written approval or consent thereto of the holders of all . the
then outstanding Bonds, or (ii) any other amendment, change or
modification of the Basic Documents without the giving of 'notice
as provided in this Section of such proposed amendment, change or
modification and receipt of the written approval or consent
thereto of the holders of not less than sixty-six and two-thirds
percent (66-2/3%) in aggregate principal amount of the Bonds then
outstanding. Such approval or consent of the Bondholders shall
be procured as provided in Section 8.03 hereof with respect to
Supplemental Indentures. If at, any time the Issuer, the Bank and
the Company shall request the consent of the Trustee to any such
proposed amendment, change or modification of the Basic
Documents, as provided in clause (i) or (ii) of the first
sentence of this Section, the Trustee shall, upon being
satisfactorily indemnified with respect to expenses plus interest
thereon, cause notice of such proposed amendment, change or
modification to be provided 'in the same manner as required by
Section 8.03 hereof with respect to notice of Supplemental
indentures,-which notice shall briefly set forth the nature of
such proposed amendment, change or modification and shall state
that copies of the instrument embodying the same are on file at
the -corporate trust office of the Trustee for' inspection by all
Bondholders. Notwithstanding anything herein to the contrary, no
amendment may be made without the Bank's consent.
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• i
ARTICLE 28
DEFEASANCE
Section 9.01. Release o€ Indenture. If the Issuer shall
pay or cause to be paid a discharged all the outstanding Bonds,
or there shall otherwise be paid to the holders of the
outstanding Bonds all Bond service charges due or to become due
thereon, and provision shall also be made for paying all other
sums payable hereunder or under the Basic Documents, then and in
that event this Indenture (except for Section 5.05, 5.06, and
9.02 hereof) shall cease, determine and become null and void, and
the covenants, agreements and other obligations of the Issuer
hereunder shall be discharged and satisfied. The Trustee then
shall release this Indenture and execute and deliver to the
Issuer such instruments in writing as shall be requisite to
evidence the release and discharge as may be reasonably required
by the Issuer, and the Trustee and Paying Agents shall assign and
deliver to the Issuer any property at the time subject to the
lien of this Indenture which may then be in their possession,
except amounts in the Bond Fund required to be paid to the
Company under Article Whereof, or to be held by the Trustee and
Paying Agents under Section 5.05. hereof or otherwise for the
payment of Bond service charges.
Section 9.02. Pa ent and Discharge of Bonds. All the
outstanding Bonds Shall e deemed to ave been paid and
discharged within the meaning of this Indenture, including
without limitation, Section 9.01 hereof if:
(a) the Trustee and the Paying Agents shall have
received, in trust for and irrevocably committed thereto,
sufficient moneys, or
(b) the Trustee shall have received, in trust for and
irrevocably committed thereto, noncallable direct
obligations of the united States of America which are
certified by an independent public accounting firm of
national reputation to be of such maturities and interest
payment dates and to bear such interest as will, without
further investment or reinvestment of either the principal
amount thereof or the interest earnings therefrom (likewise
to be held in trust and committed, except as hereinafter
provided) be sufficient together with moneys referred to in
(a) above, for the payment, at their maturities or
redemption dates, of all Bond service charges thereon to the
date of maturity or redemption, as the case may be, or if
default in such payment shall have occurred on such maturity
or redemption date, then for the payment of all Bond secharges to the date of the tender of such payment; provided
that if any Bonds are to be redeemed prior to the maturity
thereof, notice of such redemption shall have been duly
given or irrevocable provision satisfactory to the Trustee
9-1
shall have been duly made for the giving of such notice.
Any moneys held by the Trustee in accordance with the
provisions of this Section may be invested by the Trustee
only in direct obligations of the United States the
maturities or redemption dates of which, at the option of
the holder, shall be not later than the time or times at
which moneys will be required for the aforesaid purposes.
Any income or interest earned by, or incremental to, the
investments beld under this Section shall, to the extent
determined from time to time by the Trustee to be in excess
of the amount required to be held by it for the purposes of
this Section, be transferred at the time of such
determination as provided in Section 5.06 hereof for
transfers of remaining amounts in the Bond Fund. In the
event of nonpresentment as referred to in Section 5.05
hereof, the moneys held pursuant to this Section to which
Section 5.05 would apply but for the release of this
Indenture shall be held and paid as provided for in said
Section 5.05.
(c) No Bond may be so deemed paid or defeased if, as a
result thereof or of any other action in connection with
which the provision for payment of such Bond is made, the
interest payable on any Bond is made subject to federal
income taxes. The Trustee and the Issuer may require and
rely upon an opinion of Bond Counsel (which opinion may be
based upon a ruling or rulings of the Internal Revenue
Service) to the effect that the provisions of this paragraph
will not be breached by so providing for the payment or
defeasance of any Bonds before accepting any deposit under
this Section.
(d) No Bond may be so deemed paid or defeased until
the Trustee is provided with an opinion of counsel with
recognized expertise on Bankruptcy Law that .moneys paid or
deposited are not subject to the "preference" provisions of
Section 547 of the Bankruptcy Code, 11 U.S.C. Section 101,
et. seq.
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•
•
ARTICLE X
COVENANTS AND AGREEMENTS OF THE ISSUER
cpctinn 10.01_ Covenants and Agreements of the Issuer. In
addition to any other covenan
contained in this Indenture,
agrees with the Bondholders and
is an agreements o the issuer
the issuer further covenants and
the Trustee as follows:
(a) Payment of Bond Service Charges. The Issuer will,
solely from the sources herein provided, pay or cause to be
paid all Bond service charges on the dates, at the places
and in the manner provided in this Indenture.
(b) Revenues and Ass! nment of Revenues. The Issuer
will not p -Ledge or assign the Revenues or create or permit
to be created any debt, lien or charge thereon other than
the assignment thereof under this Indenture.
(c) Recordings and Filings. The issuer will cause
this Indenture a any related documents or instruments
relating to the assignment made by it under this Indenture
to secure the Bonds, to be recorded and filed in such manner
and in such places as may be required by law in order to
fully preserve and protect the security of the holders of
the Bonds and the rights of the Trustees hereunder.
(d) Inspection of Project Books. All books and
documents in the Issuer ,s possession relating to the Project
and the Revenues shall at all times during the Issuer's
regular business* hours be open to inspection by such
accountants or other agents of the Trustee as the Trustee
may from time to time designate.
(e) Registration Books. At reasonable times and under
reasonable regulations established by the Trustee, the Bond
Register of the Issuer held by the Trustee may be inspected
and copied by the Company, Bank, any Fiduciary or by holders
(or a designated (25%) or morerepresentative
principal thereof)
amount of
Bonds then
percent
outstanding.
(f) Rights and Enforcement of the Agreement. The
Trustee, in its name or in the name of the Issuer may, for
and on behalf of the Bondholders, enforce all rights of the
Issuer, except for the Issuer's rights to notice or
indemnity, and all obligations of the Company and Bank under
and pursuant to the Basic Documents, whether or not the
Issuer is in default in the pursuit or enforcement of such
rights and obligations. However, the Issuer shall do all
things and take all actions on its part necessary to comply
with obligations, duties and responsibilities on its part
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under the Issuer Documents and will take all actions within
its authority to keep the Basic Documents in effect in
accordance with the terms thereof.
(g) Arbitrage Covenant. Notwithstanding any other
provision hereof or o any other instrument, the Issuer will
make no investment or other use of the proceeds of the Bonds
or other moneys held hereunder which would cause the Bonds
to be arbitrage bonds under Section 103(c) of the Code.
Section 10.02. Performance of Covenants Authority and
Actions. The Issuer will at Ur times faithfully observe an
pe for-rm all agreements, covenants, undertakings, stipulations and
provisions contained in the Agreement, this Indenture, the Bond
Resolution, and in any and every Bond executed, authenticated and
delivered under the Indenture, and in all proceedings of its
Legislative Authority pertinent thereto, on its part to be
performed or observed. The Issuer represents that it is duly
authorized by the Constitution and laws of the State, including
particularly and without limitation the Act, to issue the Bonds,
to execute the Issuer Documents and to provide the security for
payment of the Bond service charges in the manner and to the
extent set forth in this Indenture; that all actions on its part
for the issuance of the Bonds and for the execution and delivery
of the Issuer Documents have been or will be duly and effectively
taken; and that the Bonds will be valid and enforceable special
obligations of the Issuer according to the terms thereof. Each
obligation of the Issuer required to be undertaken pursuant to
the Bond Resolution, the Issuer Documents and the Bonds is
binding upon the Issuer, and such officer or employee thereof as
may from time to time have the authority under law to take such
action as may be necessary to perform all or any part of such
obligation, as a duty of the Issuer and of each such officer and
employee resulting from an office, trust, or station.
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T • •
ARTICLE BI
MISCELLANEOUS
Section 11.01. Instruments of Bondholders. Any consent,
request, direction, approval, o Section or other instrument
required by this Indenture to be signed and executed by the
Bondholders may be in any number of concurrent writings of
similar tenor and may be signed or executed by such Bondholders
in person or by agent appointed in writing. Proof of the
execution of any such consent, request, direction, approval,
objection or other instrument or of the writing appointing any
such agent and of the ownership of Bonds, if made in the
following manner shall be sufficient for any of the purposes of
this Indenture, and shall be conclusive in favor of the Trustee
with regard to any action taken under such request or other
instrument, namely:
(a) The fact and date of the execution by any person
of any such writing may be proved by the certificate of an
officer in any jurisdiction, who by law has power to take
acknowledgments within that jurisdiction, that the person
signing the writing acknowledged before him the execution
thereof, or by affidavit of any witness to such execution.
(b) The fact of ownership of Bonds shall be proved by
the Bond Register maintained by the Trustee as Bond
Registrar.
Nothing contained herein shall be construed as limiting the
Trustee to the proof referred to in paragraph (a). It is
intended that the Trustee may accept any other evidence of the
matters herein stated which it deems to be sufficient. Any
request or consent of the holder of any Bond shall bind every
future holder of the same Bond, in respect to anything done or
suffered to be done by the Issuer, or.any Fiduciary in pursuance
of such request or consent.
Section 11.02. Limitation of Rights. With the exception of
rights expressly conferred in this Indenture, nothing expressed
or mentioned in or to be implied from this Indenture or the Bonds
is intended or shall be construed to give to any person other
than the parties hereto, the Company, the Bank and the holders of
the Bonds, any legal or equitable right, remedy or claim under or
in respect to this Indenture or any covenants, conditions and
provisions contained herein. This Indenture and all of those
covenants, conditions and provisions are intended to be and are
for the sole and exclusive benefit of the parties hereto, the
Company, the Bank and the holders of the Bonds as herein
provided.
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• i
Section 11.03. Severability. In case any section or
provision of this Indenture, or any covenant, stipulation,
obligation, agreement, act or action, or part thereof made,
assumed, entered into or taken under this Indenture, or any
application thereof, is for any reason held to be illegal or
invalid, or is at any time inoperable, such illegality or
invalidity or inoperability- shall not affect the remainder
thereof or any other section or provision of this Indenture or
any other covenant, stipulation, obligation, agreement, act or
action, or part thereof, made, assumed, entered into or taken
under this Indenture, which shall at the time be construed and
enforced as if such illegal or invalid or inoperable portion were
not contained therein. Any such illegality or invalidity or
inoperability or any application thereof shall not affect any
legal and valid and operable application thereof, and each such
section, provision, covenant, stipulation, obligation, agreement,
act or action, or part thereof, shall be deemed to be effective,
operative, made, entered into or taken in the manner and to the
full extent from time to time permitted by law.
Section 11.04. Notices. It shall be sufficient service or
giving of any notice, request, complaint, demand or other paper
if the same shall be duly mailed by first class mail addressed to
the respective Notice Addresses. The parties may, by notice
given hereunder, designate any further or different addresses to
which subsequent notices, certificates or other communications
shall be sent.
Section 11.05. Payments, Tenders and Redemptions Due on
Business Days. In any case where an Interest Payment Date or the
ate o maturity of the principal of any Bonds or the. date fixed
for tender or redemption of any Bonds shall not be a Business
Day, then payment of Bond service charges-need not be made by
that Paying Agent on that date but may -be made on . the - next
succeeding Business Day on which 'that Paying Agent- -is open for
business and the tender or redemption with the same force and
effect as if made on the date of maturity or the date fixed for
tender or redemption, and no interest shall accrue for the period
after that date.
Section 11.06. Priority of this Indenture. It is intended
that this Indenture s all be superior to any liens which may be
placed upon the Revenues or any other funds or accounts created
pursuant to this Indenture.
Section 11.07. Extent of Covenants; No Personal Liability.
All covenants, stipulations, obligations and agreements of the
Issuer contained in this Indenture are and shall be deemed to be
covenants, stipulations, obligations and agreements of the Issuer
to the full extent authorized by the Act and permitted by the
Constitution of the State. No covenant, stipulation, obligation
or agreement of the Issuer contained in this Indenture shall be
deemed to be a covenant, stipulation, obligation or agreement of
any present or future member, officer, agent or employee of the
11-2
I1 •
Issuer or the Legislative Authority in other than his official
capacity, and neither the members of the Legislative Authority
nor any official executing the Bonds shall be liable personally
on the Bonds or be subject to any personal liability or
accountability by reason of the issuance thereof.
Section 11.08. Bindin Effect. This instrument shall inure
to the benefit of an shal a binding upon the Issuer and the
Trustee and their respective successors and assigns, subject,
however, to the limitations contained in this indenture.
Section 11.09. Counterparts. This Indenture may be executed
in any number of counterparts, each of which shall be regarded as
an original and all of which shall constitute but one and the
same instrument.
Section 11.10. Captions. The captions or headings in this
Indenture shall be solely for convenience of reference and in no
way define, limit or describe the scope of intent of any
provisions or Sections of this Indenture.
Section 11.11. Governing Law. This Indenture and the Bonds
shall be deemed to be contracts made under the laws of the State
of Colorado and for all purposes shall be governed by and
construed in accordance with the laws of the State of Colorado.
11-3
ARTICLE XII
INITIAL FIXED RATE AND SUBSEQUENT FIXED FLOATING OR FIXED RATE
Section 12.01. Initial Fixed Rate. From the Dated Date and
until January 22, 385, the Bond shall bear a fixed rate of
interest as shown on the Bond Form, Exhibit A.
Section 12.02. When Floating or Fixed Rate.
A. From January 22, 1985 until September 15, 1986, the
Bonds shall bear interest at a fixed interest rate determined as
follows : and les~st o cl- - I . -tom ~4(tt r ve
¢ c,u.1' ~ c_ i V ~ e~
On January 15, 1984 the Indexing Agent shall compute the r
Fixed Interest Index, as provided in Section 12.05 A, and shall
immediately notify the Trustee and the Remarketing Agent thereof,
by telephone, telecopier, telegraph, or such other means to which
the Trustee and the Remarketing Agent shall consent. The e
Remarketing Agent shall compute the fixed interest rate based on
the Fixed Interest Index as so computed, as follows:
The fixed interest rate shall be that rate which, if borne
by the Bonds, would in the judgment of the Remarketing Agent be
the rate necessary to enable the Bonds to be remarketed at par.
The interest rate shall be determined by the Remarketing Agent in
its sole judgment based on evaluation at par of no fewer than 10
tax-exempt issues of comparable credit ratings time period during
which the rate is fixed. In no event may the fixed interest rate
be less than 80% of the Fixed n ezes Rate nde qr rea er than
120% ctf ua~} Index. `r11e 12e z' b `n~it~ izi"e'
` "_`FtteA t-ttere3t M+r_ rtq ote-" S s'~~'~cr
The fixed interest rate shall be subject to veri cation by
the Trustee, but otherwise shall be binding upon the Bondowners,
the Issuer, the Trustee, the Tender Agent, the Remarketing Agent,
the Company, and the Bank. The Remarketing Agent shall notify
the Trustee and the Company of the fixed interest rate, by
telephone, telecopier, telegraph or such other means as to which
the Trustee and the Company shall consent.
B. From September 15, 1986, the Bonds shall bear interest
at the floating rates determined under Section 12.04. The
floating rate may be converted to a fixed rate in accordance with
Section 12.05. and, once converted, shall remain fixed until the
final maturity of the Bonds.
Section 12.03. Calculation of Interest Accrual. Interest
accrued on the Bonds shall be computed (i) during the period of
time, if any, when interest on the Bonds is paid more often than
semiannually, on the basis of a year of 365 or 366 days, as
appropriate, for the actual number of days elapsed, and (ii)
otherwise, on the basis of a year of 360 days composed of twelve
30-day months.
12-1 Ck.) J anu a;, (98:5 w
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~ -F~ as
cal ica..~ t~•
Section 12.04. Floating Rates.
A. Computation of Index. During any period when, pursuant
to Section 12.0 2, the Bonds are to bear interest at a floating
rate, no later than 11:30 a.m. local time of the indexing Agent
on the fourth (4th) Business Day immediately preceding the first
(1st) day of each Floating Rate Period, the Indexing Agent shall
compute the Floating Interest Index and, notify the Trustee and
the .Remarketing Agent thereof. Such computation shall be binding
upon' the Bondholders, the Issuer, the Trustee, the Tender Agent,
the Remarketing Agent, the Company and the Bank. The floating
Interest Index shall be based on evaluations at par of no fewer
than twenty (20) tax-exempt issues of comparable credit rating
and time periods during which interest rates remain fixed, to the
Bonds.
B. Determination of Rate. Immediately upon receipt of the
Floating Interest Index, but in no event later than 4:00 p.m.
local time of the Remarketing Agent on the fourth (4th) Business
Day immediately preceding the first (1st) day of each Floating
Rate Period, the Remarketing Agent shall determine the rate for
such Floating Rate Period.
The rate shall be a rate which, if borne by the Bonds would,
in the judgment of the Remarketing Agent, giving due regard to
prevailing market conditions, be the interest rate just necessary
to enable the Remarketing Agent to remarket the Bonds at par.
The interest rate shall be determined by the Remarketing Agent in
its sole judgment based on evaluations'at par of no fewer than 10
tax-exempt issues of comparable credit ratings and time periods
during which interest rates remain fixed. In no event may the
floating interest rate be less than 80% of 'the Floating Interest
Index or greater than 120% of such Index.
C. Immediately upon determination of the rate for any
Floating Rate Period, the Remarketing Agent shall notify the
Trustee of the interest rate for such-Floating-Rate Period. The
interest rate shall be subject to verification by the Trustee,
but otherwise shall be binding upon the Bondholders, the Issuer,
the Trustee, the Tender Agent, the Remarketing Agent, the Company
and the Bank.
Section 12.05. Conversion to Fixed Interest Rate.
A. Fixed Interest Index. During any time when the Bonds
bear interest at a oating rate, the Indexing Agent shall
compute the Fixed Interest Index on each Semiannual Date, and at
any other time at the request and expense of the Company. The
Fixed Interest Index shall be computed in like fashion as is
prescribed in Section 12.04 for the Floating Rate Index. The
Indexing Agent immediately shall notify the Trustee and the
Remarketing Agent of the Fixed Interest Index, and the
12-2
0
0
Remarketing Agent shall immediately notify the Issuer, the Tender
Agent, the Company and the Bank of the Fixed Interest Index as so
computed.
B. Establishment of Conversion Date--Company-Directed
Method. The Conversion Date shall be established upon receipt by
tt a Issuer, Trustee, Indexing Agent and Remarketing Agent at
direction from the Company specifying the Conversion Date, which
must be the fifteenth (15th) day of a month, or next Business
Day, if appropriate, at least thirty (30) days after the date of
the Company direction. The direction, to be effective, must be
accompanied by an opinion of Bond Counsel stating that the
establishment of a fixed interest rate is permitted by this
Indenture and the Act and will not have an adverse effect on the
federal income tax exemption of interest on the Bonds.
C. Fized Rate. On the third (3rd) Business Day
immediately preceding the twentieth (20th) day prior to the
Conversion Date, as so established, the Indexing Agent shall
again compute the Fixed Interest Index and shall notify the
Trustee and the Remarketing Agent thereof, by telephone,
telecopier, telegraph, or such other means to which the Trustee
and the Remarketing Agent shall consent. The Remarketing Agent
shall compute the fixed interest rate based on the Fixed Interest
Index as so computed, as follows:
The fixed interest rate shall be that rate, which if borne
by the Bonds, would in the judgment of the Remarketing Agent be
just the rate necessary to enable the Remarketing Agent to
remarket the Bonds at par. The fixed interest rate shall be
calculated by the Remarketing Agent in like fashion as provided
in Section 12.04 for the Floating Interest Rate. In no event may
the fixed interest rate be less than 80% of the Fixed Rate index
or greater than 120% of such Index.
The fixed interest rate shall be subject to verification by
the Trustee, but otherwise shall be binding upon the Bondholders,
the Issuer, the Trustee, the Tender Agent, the Remarketing Agent,
the Company, and the Bank. The Remarketing Agent shall notify
the Trustee and the Company of the fixed interest rate, by
telephone, telecopier, telegraph or such other means as to which
the Trustee and the Company shall consent.
F. Notice. No later than twenty (20) days prior to the
Conversion Date as so established, the Trustee shall give written
notice to the Issuer, the Company, the Bank, the Indexing Agent,
the Remarketing Agent, the Tender Agent and the Bondholders,
stating: (i) that the interest rate on the Bonds will convert
from a floating interest rate to a fixed interest rate on the
Conversion Date; (ii) the date that the Trustee has established
as the Conversion Date; (iii) the fixed interest rate, as
computed by the Remarketing Agent; (iv) that. interest on the
Bonds will be payable on each Semiannual Date after the
Conversion Date, beginning the first Semiannual Date that is at
12-3
least forty-five (45) days following the Conversion Date,
beginning the first (1st) Semiannual Date that is at least
forty-five (45) days following the Conversion Date; (v) that the
Bondholder may notify the Remarketing Agent and tender his Bonds
to the Tender Agent for purchase in accordance with Section 13.01
hereof; and (vi) that, after the Conversion Date, the Bondholders
will not have the right to tender such Bonds for purchase
pursuant to Section 13.01 hereof.
12-4
ARTICLE XIII
TENDERS AND REMARKETING
Section 13.01. Tenders.
A. Demand Purchase Option and Remarketing.
(1) Any Bond shall be purchased, at the demand of the
owner thereof, at par plus accrued interest to the date of
purchase, on the last Business Day of any Floating Rate Period
upon (i) receipt by the Remarketing Agent at least seven (7) days
before the purchase date of a written notice that states the
principal amount of such Bond and (ii) delivery of the following
to the office of the Tender Agent at or prior to 10:00 a.m. local
time of the Tender Agent on the purchase date: (a) the Bond
(with all necessary endorsements), (b) a copy of the notice
described in clause (i) above, (c) instructions for the payment
of the purchase price (by wire transfer or by check or draft
mailed or delivered in person at the office of the Tender Agent
on the purchase date),, and (d) in the case of a Bond to be
purchased prior to an-Interest Payment Date and after the Record
Date immediately preceding such Interest Payment Date, a due-bill
check, in form satisfactory to the Tender Agent, for interest due
on such Interest Payment Date.
(2) The Remarketing Agent promptly shall deliver to
the Trustee, the Tender Agent and the Company a copy of each
notice delivered 'to it in accordance with this Section and,
immediately upon delivery of Bonds in accordance with this
Section, the Tender Agent shall give telephonic or telegraphic
notice, promptly confirmed by a written notice, to the issuer,,
the Trustee, the Remarketing Agent, the Company and the Bank
specifying the aggregate principal amount of Bonds delivered.
B. Alternative Security Optional Tender.
The Bonds are subject to an Alternative Security
Optional Tender on the Alternative Security Effective Date,
provided however, that the owner of each bond has the right to
have his Bonds purchased at par plus accrued interest under such
Alternative Security Optional Tender by providing written notice
of such election to the Trustee. The Notice of Alternative
Security Optional Tender will be sent to all registered owners of
the Bonds upon posting of the Alternative Security, which date
shall be at least 30 days prior to the Alternative Security
Optional Tender. Such Notice of Alternative Security Optional
Tenor
% rihal l state the nature and amount of Alternative Security,
theArale or rates on the Bonds subsequent to the Alternative
Security Optional Tender which shall be not less than the
nal- interest rate on the Bonds Written notice of each
registered owner's tender election mu be received in writing by
the Trustee at least fifteen days prior to the Alternative
r"40 tL
13- vvrvnx.caz F
LIL,
Al
Y
Security Effective Date. If the posted Alternative Security is
insufficient to pay all Bonds tendered but not remarketed
pursuant to the Alternative Security Optional Tender, on the
Alternate Security Effective Date, the Notice of Alternative
Security Optional Tender shall be deemed null and void. Bonds
tendered on the Alternative Security Effective Date shall be
remarketed pursuant to the terms of this Indenture.
C. Mandatory Tenders.
(1 ) The Bonds are subject to a Mandatory Tender by,the
Bondowners for purchase at a purchase price equal to the
principal amount thereof on September 15, . 1986, provided,
however, that if and to the extent Alternative Security has been
provided, the owner of each Bond has the right to have his Bonds
excluded from such Mandatory Tender by providing written notice
of such election to the Trustee. A notice of Mandatory Tender
will be sent to all registered owners of the Bonds on August 151
1986. Such notice of Mandatory Tender shall state whether an
Alternative Security has been provided, the nature and amount of
such Alternative Security, the fixed or variable rate or rates on
the Bond subsequent to September 150, 1986, and the interest,
redemption and other terms and provisions as shall apply to the
Bonds subsequent to September 15, 1986. Written notice of each
.registered Bondowner's intention to be excluded from the
Mandatory Tender must be received in writing by the Trustee seven
(7) days prior to September 15, 1986. To the extent Alternative
Security is provided with respect to less than all the Bonds,
then. the Bonds to be excluded from the Mandatory Tender shall be
taken pro rata from each registered Bondowner requesting his
Bonds to be so excluded. The Trustee shall immediately inform
the Tender Agent and Remarketing Agent of such notice. Bonds not
excluded from the Mandatory Redemption shall be deemed tendered
at par on September 15, 1986.
(2) The Bonds are subject to a Mandatory Tender by the
Bondowners for purchase at a purchase price equal to the
principal amount thereof on the Conversion Date, if any,
provided, however, that if and to the extent Alternative Security
has been provided, the owner of each Bond has the right to have
his Bonds excluded from such Mandatory Tender by providing
written notice of such election to the Trustee. A notice of
Mandatory Tender will be sent to all registered Owners of the
Bonds-on within three (3) days of receipt of Company direction of
the Conversation Date by the Remarketing Agent. Such notice of
Mandatory Tender shall state whether an Alternative Security has
been provided, the nature and amount of such. Alternative
Security, the ' fixed rate of interest on the Bonds subsequent to
the Conversion Date and the redemption and other terms and
provisions as. shall apply to the Bonds subsequent to the
Conversion Date. Written notice of each registered Bondowner's
intention to be excluded from the Mandatory Tender must be
received in writing by the Trustee seven (7) days prior to the
Conversion Date. To the extent Alternative Security is provided
13-2
with respect to less than all the Bonds, then the Bonds to be
excluded from the mandatory Tender shall be taken pro rata from
each registered Bondowner requesting his Bonds to be so excluded.
The Trustee shall immediately inform the Tender Agent and
Remarketing Agent of such notice. Bonds not excluded from the
Mandatory Redemption shall be deemed tendered at par on the
Conversion Date.
Notwithstanding the foregoing, no Bonds will be purchased if
an Event of Default under the Indenture or the Agreement has
occurred and is continuing.
Section 13.02. Remarketing.
A. Except as otherwise provided in this Section, upon
receipt of copies of any notices delivered pursuant to Section
13.01 hereof, the Remarketing Agent shall offer for sale, and use
its best efforts to sell, the Bonds that were the subject of such
notices, on the purchase date at par plus accrued interest to the
respective dates of purchase.
B. Notwithstanding the provisions of paragraph A of this
Section, to the extent that moneys are available in the Bond Fund
to redeem Bonds and are furnished to the Tender Agent by the
Trustee pursuant to Section 13.03 (A)(i) hereof, and are on
deposit with the Tender Agent at the time any Bonds delivered to
the Tender Agent are to be purchased, any Bonds delivered to the
Tender Agent shall be purchased with such moneys and shall not be
sold by the Remarketing Agent, but shall be delivered to the
Trustee for cancellation.
C. No later than the fifth (5th) Business Day prior to
every date of purchase of Bonds, the Remarketing Agent shall give
the Trustee telegraphic or telephonic notice of the principal
amount of Bonds as to which notice of purchase has been given
pursuant to Section 13.01 hereof and which have not been
remarketed by the Remarketing Agent by-such date.
D. (1) No later than 11:30 a.m. local time of the Trustee
on the fourth (4th) Business Day immediately preceding any date
of purchase of Bonds, the Trustee shall make demand on the Bank
in an amount sufficient to pay the purchase price payable on the
purchase date of the Bonds that were the subject of the notice
given by the Remarketing Agent under paragraph (C) above.
(2) In the event of a Tender pursuant to 13.01, if
there is no Alternative Security or insufficient Alternative
Security to make payment pursuant to 13.02 D.(1), the Trustee
shall liquidate investments in the Construction Fund in an amount
sufficient to pay the purchase price payable on the purchase date
of the Bonds that are so tendered and for which notice has been
given under paragraph C. above.
13-3
0 0
E. No later than _10:00 a.m. local time of the Trustee on
the second (2nd) Business Day immediately preceding any date of
purchase of Bonds, the Remarketing Agent shall give telegraphic
or telephonic notice, promptly confirmed by_a written notice, to
the Trustee specifying the aggregate principal amount of Bonds,
if any, sold by it .pursuant to this Section. Immediately upon
receipt of such -notice, the. Trustee shall give telegraphic or
telephonic notice of such amount to the Tender Agent, the Issuer,
the Company and the Bank. If the amount received from such sale
reduces the amount needed to pay the purchase price due and
payable on the purchase date, the Bank may reduce its payment
accordingly, if not yet made.
F. In the event that any Bonds are purchased with funds
furnished by the Bank, the Remarketing Agent shall continue to
use its best efforts to sell such Bonds on behalf of the Bank for
so,- long as such Bonds are held by the Bank. Upon the sale of
such Bonds by the Remarketing Agent, the Remarketing Agent shall
notify the Bank, the Tender Agent and the Company of such sale,
shall instruct the Bank to deliver such Bonds to the Tender Agent
for; purchase on such date as may be specified by the Remarketing
Agent, and shall transfer the proceeds of such sale to the Tender
Agent no later than such date. The requirements of Section 13.01
hereof shall not apply to a purchase of Bonds in accordance with
this Section.
G. Notwithstanding anything in this Indenture to the
contrary, there shall be no purchases of Bonds pursuant to this
Section if -an Event of Default under the Indenture or any event
of default under the Agreement has occurred and is continuing.
Section 13.03. Purchase of Bonds Delivered to the Tender
Agent.
A. On the date on which the Bonds delivered to the Tender
Agent are to be purchased pursuant to Section 13.01 hereof, such
Bonds shall be purchased from the owners thereof in accordance
with the payment instructions given by such-owners pursuant to
Section 13.01 hereof (or if none, by check or draft mailed to the
address shown on the registration books of the Trustee) at a
purchase price equal to the principal amount thereof (plus
accrued interest thereon, if any, to the date of such purchase),
but solely from the following sources in the sequence. indicated
below, neither the Issuer, the Trustee nor the Tender Agent
having an obligation to use funds from any other source:
.(i) moneys in the Bond Fund that are furnished by the
Trustee to the Tender Agent;
(ii) proceeds of the sale of such. Bonds by the
Remarketing Agent pursuant to Section 13.02 hereof; and
13-4
(iii) moneys paid by the Bank.
B. Anything herein to the contrary notwithstanding, there
shall be no purchases of Bonds from moneys in the Bond Fund if an
Event of Default under the Indenture or any event of default
under the Agreement has occurred and is continuing.
Section 13.04. Escrow Fund. The Escrow Fund is hereby
created and established with the Tender Agent. All moneys
deposited in the Escrow Fund shall be used solely for the
purposes and shall be held, administered and distributed by the
Tender Agent as provided in this Section.
A. The Tender Agent shall deposit into the Escrow Fund (i)
all proceeds of the remarketing of Bonds remitted to the Tender
Agent by the Remarketing Agent pursuant to the provisions of this
Article, (ii) all amounts received by the Tender Agent from the
Trustee through the Bank to pay the purchase price of Bonds
delivered for purchase and not remarketed hereunder; and (iii)
all amounts received by the Tender Agent from the Trustee as a
result of claims under the any Alternative Security to pay the
purchase price of Bonds delivered for purchase and not remarketed
hereunder. The Tender Agent shall apply all amounts on deposit
in the Escrow Fund to pay the purchase price of Bonds purchased
hereunder as provided in this Article.
B. The Tender Agent shall hold all moneys on deposit in
the Escrow Fund uninvested until disbursements may be made from
the Escrow Fund in accordance with this Article to pay the
purchase price of the Bonds.
13-5
ARTICLE XIV
INDEXING AGENT, TENDER AGENT AND
REMARKETING AGENT
Section 14.01. Indexing Agent. The Indexing Agent shall be
a nationally recognized municipal securities evaluation service
authorized by law to perform -all the duties imposed upon it
hereby. The Indexing Agent may resign at any time and be
discharged of the duties and obligations hereunder by giving at
least sixty days' (60) notice to the Issuer, the Trustee, the
Company, the Bank and the Remarketing Agent. The Indexing Agent
and may be removed at any time, with the consent of the Company
tin writing he Company, ssigned
and filed the Bank, by the instrument
the Bank h and the
and
Remarketing Agent.
The Remarketing Agent shall appoint the initial Indexing
Agent.
Section 14.02. Tender Agent. The Tender Agent shall be a
corporation duly organize un er the laws of the United States of
America or any state -or territory thereof, having a combined
capital stock, surplus and undivided profits of at least $50
million and authorized by law to perform all the duties imposed
upon it hereby.
The Tender Agent may resign at any time and be discharged of
the duties and obligations created hereby by giving at least
sixty days' notice to the Issuer, the Trustee, the Company, the
Bank and the Remarketing Agent. The Tender Agent may be removed
at any time, at the direction of the Company with the consent of
the Bank or at the direction of the Bank, by an instrument,
signed by the Issuer and filed with the Trustee, the company, the
Bank and the Remarketing Agent. In the event of the resignation
or removal of the Tender Agent, the Tender Agent shall pay over, mone
such c assign and relifethere be nossuccessor i to the Tru t eaity to its
successor o
If the Tender Agent shall resign or be removed, or be
dissolved, or if the property or affairs of the Tender Agent
shall be taken under the control of any state or federal court or
administrative body because of bankruptcy or insolvency, or for
any other reason, and the Issuer shall not have appointed its
successor as Tender Agent, the Trustee shall ipso facto be deemed
to be the Tender
the Issuer of the Tender Agent oresucces or Tender
appointment by
Agent.
14-1
0
The Philadelphia National Bank appointed Tender Agent.
Section 14.03. Remarketin Agent. The Remarketing Agent
shall be Inc., andrbe of--tTFe--National Association of
to perform all the duties
Dealers, I
imposed upon it hereby.
The Remarketing Agent may resign at any time and be
discharged of the duties and obligations created hereby, by
giving at least sixty (60) days' notice to the Issuer, the
Trustee, the company, the Bank and the Tender Agent. The
Remarketing Agent may be removed at any time, at the direction of
the Company with the consent of the Bank, or at the direction of
the Bank by an instrument, signed by the Issuer and filed with
the Trustee, the Company and the Tender Agent. In the event of
the resignation or removal of the Remarketing Agent, the Bank and
the Remarketing Agent shall pay over, assign and deliver any
sucby it in such cessor, to the Trustee capacity to its
moneys and a if heres be held
successor, or
Matthews & Wright, Inc. is hereby appointed Remarketing
Agent.
IN WITNESS WHEREOF, the
be executed in its name and
officer; and the Trustee,
trusts created hereunder,
executed in its name by its
the day and year first above
Issuer has caused this Indenture to
on its behalf by its duly authorized
in token of its acceptance of the
has caused this Indenture to be
duly authorized officer, all as of
written.,
ISSUER
' f G'O l.0 / O
-rV ,VW Oft
SEAL )
T. \
o n Clerk
By:
Title: Mayor
TRUSTEE
- t k,- P1ktL1VMP14
A-r ,w/tL rSlwK
By:
Title: L/
14-2
0 •
EXHIBIT A
(FORM OF FACE OF BOND)
REGISTERED
NO.
TOWN OF AVON, COLORADO
Industrial Development Revenue Bonds
Series 1984
(Avon/Beaver Creek Holiday Inn Hotel Project)
Initial
Interest Rate: Maturity Date: Dated as of: CUSIP Number
7.1% December 15, 2014 December 15, 1984 054027 AA5
Registered Owner:
Principal Sum:
Dollars
The Town of Avon, Colorado (the "Issuer"), for value
received, promises to pay to the order of:
the Registered Owner or registered assigns (specified above), but
solely from the sources and in the manner hereinafter referred
to, the principal sum of
DOLLARS )
on, unless called for earlier redemption, the maturity date shown
above, and to pay from those sources interest thereon on each
six-month anniversary of each June 15 and December 15, ("Interest
Payment Date") commencing on June 15, 1985 at the rate of
interest described below until the principal sum is paid or has
been provided for. This Bond will bear interest from the most
recent Interest Payment Date to which interest has been paid or
duly provided for or, if no interest has been paid, from the
Dated Date. The principal of and premium, if any, on this Bond
are payable upon presentation and surrender hereof at the
corporate trust office of the Trustee, currently Philadelphia
National Bank (the "Trustee"). Interest on this Bond will be
paid on each Interest Payment Date by check or draft mailed to
the person in whose name this Bond is registered ("Owner" or
"Bondowner") on the registration books of the Issuer maintained
by the Trustee and at the address appearing thereon at the close
A-1
of business on the Business Day preceding such Interest Payment
Date (the "Regular Record Date") or at the option of any owner
of $1 million or more in aggregate principal amount of Bonds, by
wire transfer to the account on file with the Trustee of such
Interest Payment Date. kny such interest not so timely paid or
duly,provided for shall cease to be payable to the person who is
the Owner hereof as of the, Regular Record Date, and shall be
payable to the person who is the Owner at, the close of. business
on a Special Record Date for the payment of such defaulted
interest. Such Special Record Date shall be,fixed by the Trustee
whenever moneys become available for payment of the defaulted
interest, and notice of the Special Record Date shall be given to
Bondowners not less than ten days prior-thereto. The principal
of and premium, if any, and interest on this Bond are payable in
lawful money of the United States of America without deduction
for the services of the paying agent.
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS
BOND SET FORTH ON THE REVERSE HEREOF AND 'StJCH PROVISIONS SHALL
FOR ALL PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH HERE.
It is hereby certified and recited that all acts and
conditions necessary to be done or performed by the Issuer or to
h ave.happened precedent to and in the issuing of the Bonds in
order to make them legal, valid and binding special obligations
of the Issuer in accordance with their terms, and precedent to
and in the execution and delivery of the Indenture and the
Agreement, have been performed and have happened in regular and
due form as required by law; that payment in full for the Bonds
has been received; and that the Bonds do not exceed or violate
any constitutional or statutory limitation.
This Bond shall not be valid or become obligatory for any
purpose until it shall have been authenticated by the execution
of the Certificate hereon endorsed by the Trustee under the
Indenture.
IN TESTIMONY WHEREOF, The Town of Avon, Eagle County,
Colorado, by its Town Council, has caused this Bond to be signed
in its name and on its-behalf by the facsimile signature of the
Mayor of the Town, to be attested and countersigned with the
facsimile signature of its Town Clerk, and to be sealed with the
facsimile of its seal.
TOWN OF AVON, Eagle County,
Colorado
( S E A L )
By:
Mayor
ATTESTED AND COUNTERSIGNED:
By.
Town Clerk
A-2
CERTIFICATE OF AUTHENTICATION
This Bond is one of the Series issued pursuant to the
Ordinance therein described. The complete text of the opinion of
bond counsel, Stowe & Herskovits, Denver, Colorado, dated the
date of the original issuance of the Bonds therein described, is
on file with the undersigned. .
PHILADELPHIA NATIONAL BANK,
as Trustee
By.
Authorized Officer
A-3
(FORM OF REVERSE OF BOND)
This Bond is one of an issue of Bonds in an aggregate
principal amount of $9,000,000, authorized and issued pursuant to
an indenture, dated as of the Dated Date, (the "Indenture")
between the Issuer and the Trustee, for the purpose of providing
funds to lend to Avon Resort . Properties, Ltd. (the 'Company") to
finance the costs of acquiring and constructing the Avon/Beaver
Creek Holiday Inn Hotel (the "Project") pursuant to a Loan
Agreement dated as of the Dated Date (the 'Loan Agreement")
between the Issuer and the Company. Pursuant to the Loan
Agreement and a promissory note made by the Company, the Company
has agreed to make payments sufficient to pay the principal of
and interest and any premium on all bonds issued under the
Indenture.
The term "Trustee" as used herein refers to said Trustee or
any successor Trustee appointed pursuant to the Indenture. The
Indenture and the other documents herein described are on file in
the offices of the Issuer and the Trustee. Reference is hereby
made to the Indenture for a more complete description of the
provisions, among others, with respect to the nature and extent
of the security, the - rights, duties and obligations of the
issuer, the Trustee and the Owners of the Bonds, and the terms
and conditions upon which the Bonds are issued and secured, to
all of the provisions of which Indenture, each owners, by the
acceptance hereof, assents.
The Bonds are issued pursuant to the laws of the State of
Colorado, and to an ordinance duly enacted by the governing body
of the Issuer. The Bonds are special obligations of the Issuer,
and the principal of and premium, if any, and interest on the
Bonds (the "Bond service charges") - are payable solely from the
Revenues as defined and as provided in the Indenture (being,
generally, the payments and other amounts payable under the
Agreement) and are not otherwise an obligation of the Issuer.
The Bonds are not secured by an obligation or pledge of any
moneys raised by taxation and do not represent or constitute a
debt or pledge of the faith and credit of the Issuer.
Registration, Transfer and Exchange. The Bonds are issuable
solely as fully registered bonds in the denominations of
$5,000.00 and any integral multiple thereof and are exchangeable
for fully registered Bonds of other denominations in equal
aggregate principal amounts and in authorized denominations at
the aforesaid office of the Trustee, but only in the manner,
subject to the limitations and on payment of the charges provided
in the indenture.
This Bond is transferable by the Owner in person or by his
attorney duly authorized in writing at the corporate trust office
of the Trustee as Bond Registrar upon presentation and surrender
hereof to the Trustee, all subject to the terms and conditions
provided in the Indenture.
A-4
i •
Interest Rates. The Bonds will bear interest from their
Dated Date until January 22, 1985 at the rate of seven and one-
tenth of one percent (7.1%) per annum; from January 22, 1985
until September 15, 1986 at a fixed interest rate determined as
set forth below based on the Fixed Interest Index computed on
January 15, 1985 by the Indexing Agent; and thereafter at a
floating rate of interest, calculated as set forth below, until
maturity, prior redemption, or until the date, if any,. upon which
the Bonds convert from a floating rate to a fixed rate of
interest upon the occurrence of certain events (the "Conversion
Date," as more fully described below). Interest payable on the
Bonds shall be computed, prior to the Conversion Date, on the
basis of a year of 365 or 366 days, as appropriate, for the
actual number of days elapsed, and, from and after the Conversion
Date, on the basis of a year of 360 days composed of twelve 30-
day months.
The floating interest rate shall be computed for each
calendar month, beginning the fifteenth (15th) day of each month,
(a "Floating Rate Period"), prior to the Conversion Date, based
upon an index (the "Floating Interest Index") computed on the
fourth business day immediately preceding the first day of the
Floating Rate Period, by the "Indexing Agent" appointed under the
Indenture. The Floating Interest Index is based on yields of
tax-exempt securities, selected by the Indexing Agent, with
maturities and credit ratings similar to that of the Bonds.
The floating interest rate shall be a rate which, if borne
by the Bonds, would, in the judgment of the Remarketing Agent,
giving due regard to prevailing market conditions, be the
interest rate necessary to enable the Remarketing Agent to
remarket the Bonds at par, as more fully described in the
Indenture. In no event may the floating interest rate be less
than 80% of the Floating Interest Index or greater than 120% of
such Index.
The Bonds are subject to conversion to a fixed rate upon
direction by the Company specifying the Conversion Date, which
must be on the fifteenth (15th) day of a month, or next Business
Day, if appropriate, at least 30 days after the date of Company
direction. The direction, to be effective, must be accompanied
by an opinion of nationally recognized bond counsel stating that
the establishment of a fixed interest rate is permitted by the
Indenture and the statute, ordinance or charter pursuant to which
the Bonds were issued and will not have an adverse effect upon
the tax-exempt status of the Bonds. Upon establishment of the
Conversion Date, the Trustee will give notice to all Bondowners
of conversion to a fixed rate.
Any fixed interest rate will be calculated by the
Remarketing Agent and shall be that rate which, if borne by the
Bonds, would, in the judgment of the Remarketing Agent (based on
a Fixed Interest Index computed by the Indexing Agent in like
fashion described above for the Floating Interest Index), giving
due regard to prevailing market conditions, be the rate necessary
A-5
i •
to enable the Remarketing Agent to remarket the Bonds at par, as
more fully described in the Indenture. In no event may the fixed
interest be less than 80% of the Fixed Interest Index or greater
than 120% of such Index.
The fixed interest rate after the Conversion Date will be
effective until the final maturity or redemption of the Bonds.
In no event shall the Bonds bear interest in excess of
fifteen percent (15%) per annum.
Demand Purchase Option and Remarketing.
Any Bond shall be purchased, at the demand of the owner
thereof, at par plus accrued interest to the date of purchase, on
the last Business Day of any Floating Rate Period upon (i)
receipt by the Remarketing Agent at least seven (7) days before
the purchase date of a written notice that states the principal
amount of such Bond and (ii) delivery of the following to the
office of the Tender Agent at or prior to 10:00 a.m. local time
of the Tender Agent on the purchase date: (a) the Bond (with all
necessary endorsements), (b) a copy of the notice described in
clause (i) above, (c) instructions for the payment of the
purchase price (by wire transfer or by check or draft mailed or
delivered in person at the office of the Tender Agent on the
purchase date), and (d) in the case of a Bond to be purchased
prior to an Interest Payment Date and after the Record Date
immediately preceding such Interest Payment Date, a due-bill
check, in form satisfactory to the Tender Agent, for interest due
on such Interest Payment Date.
The Remarketing Agent promptly shall deliver to the Trustee,
the Tender Agent and the Company a copy of each notice delivered
to it in accordance with this Section and, immediately upon
delivery of Bonds in accordance with this Section, the Tender
Agent shall give telephonic or telegraphic notice, promptly
confirmed by a written notice, to tho Issuer, the Trustee, the
Remarketing Agent, the Company and the Bank specifying the
aggregate principal amount of Bonds delivered.
Optional Tender.
The Bonds are subject to an Optional Tender by 'the
Bondowners for purchase at a purchase price equal to the
principal amount thereof thirty (30) days after the acquisition
of Alternative Security (tender date) to the extent Alternative
Security is provided. A notice of Optional Tender will be sent
to all registered Owners of the Bonds within three (3) days of
receipt of acquisition of Alternative Security by the Remarketing
Agent. Such notice of Optional Tender shall state the nature and
amount of the Alternative Security, and the interest, redemption
and other terms and provisions as shall apply to the Bonds
subsequent to the tender. Written notice of each registered
Bondowner's intention to be included in the Optional Tender must
A-6
be received
in writing
by the
Remarketing Agent seven (7) days
prior to
the tender
date.
The Remarketing Agent shall
immediately
inform the
Trustee
and Tender Agent of such notice.
Mandatory Tenders..
(a) The Bonds are subject to a Mandatory Tender by the
Bondowners for purchase at a purchase price equal to the
principal amount thereof on September 15, 1986, provided,
however, that if and to the extent Alternative Security has been
provided, the Owner of each Bond has the right to have his Bonds
excluded from such Mandatory Tender by providing written notice
of such election to the Trustee. A notice of mandatory Tender
will be sent to all registered Owners of the Bonds on August 15,
1986. Such notice of Mandatory Tender shall state whether an
Alternative Security has been provided, the nature and amount of
such Alternative Security, the fixed or variable rate or rates on
the Bond subsequent to September 15, 1986, and the interest,
redemption and other terms and provisions as shall apply to the
Bonds subsequent to September 15, 1986. Written notice of each
registered Bondowner's intention to be excluded from the
Mandatory Tender must be received in writing by the Trustee seven
(7) days prior to September 15, 1986. To the extent Alternative
Security is provided with respect to less than all the Bonds,
then the Bonds to be excluded from the Mandatory Tender shall be
taken pro rata from each registered Bondowner requesting his
Bonds to be so excluded. The Trustee shall immediately inform
the Tender Agent and Remarketing Agent of such notice. Bonds not
excluded from the Mandatory Redemption shall be deemed tendered
at par on September 15, 1986.
(b) The Bonds are subject to a mandatory Tender by the
Bondowners for purchase at a purchase price equal to the
principal amount thereof on the Conversion Date, if any,
provided, however, that-if and to the extent Alternative Security
has been provided, the Owner of each Bond has the right to have
his Bonds excluded from such Mandatory Tender by providing
written notice of such election to the Trustee. A notice of
Mandatory Tender will be sent to all registered Owners of the
Bonds on within three (3) days of receipt of Company direction of
the Conversation Date by the Remarketing Agent. Such notice of
Mandatory Tender shall state whether an Alternative Security has
been provided, the nature and amount of such Alternative
Security, the fixed rate of interest on the Bonds subsequent to
the Conversion Date and the redemption and other terms and
provisions as shall apply to the Bonds subsequent to the
Conversion Date. Written notice of each registered Bondowner's
intention to be excluded from the Mandatory Tender must be
received in writing by the Trustee seven (7) days prior to the
Conversion Date. To the extent Alternative Security is provided
with respect to less than all the Bonds, then the Bonds to be
excluded from the Mandatory Tender shall be taken pro rata from
each registered Bondowner requesting his Bonds to be so excluded.
The Trustee shall immediately inform the Tender Agent and
A-7
0 •
Remarketing Agent of such notice. Bonds not excluded from the
Mandatory Redemption shall be deemed tendered at par on the
Conversion Date.
Notwithstanding the foregoing, no Bonds will be purchased if
an Event of Default under the Indenture or the Agreement has
occurred and is continuing. -
Optional Redemption of Bonds upon Conversion of Bonds to a
Fixed Rate o Interest. In the event that -the Bon d9 convert to a
ix rate o interest, then the Bonds shall be subject to
optional redemption prior to maturity at the option of the issuer
(on the request of the Company) on the following dates, in
inverse numerical order, upon the payment of par and accrued
interest to the date of redemption, plus a premium, if any,
determined as follows:
(1 ) Should the Bonds convert to a fixed rate of
interest at any time during the period of September 15, 1986
to December 15, 1994, inclusive, then the Bonds shall not be
subject to optional redemption for a period of ten (10)
years fray the date upon which the Bonds convert to a Fixed
Rate of Interest.* After the expiration of this ten (10)
year no-call period, the Bonds may be redeemed upon the
payment of par and accrued interest to the date of
redemption, plus a premium of three percent (3%) of the
principal amount so redeemed. Such premium however shall
thereafter decline 1/2 of 1% per annum to par.
(2) Should the Bonds convert to a f ixed rate
of
interest at any time during the period of December 168 1
994
to December 15, 2000, inclusive, then the Bonds shall not
be
subject to optional redemption for a period of seven
(7)
years from the date upon which the Bonds convert to. a Fixed
Rate of Interest. Af ter the expiration of this seven
(7)
year no-call period, the Bonds may be redeemed on
any
th
Interest Payment Date, in inverse numerical order, upon
e
payment of par and accrued interest to the date of
lus a premium of two percent (2%) of
tion
d
the
the
, p
emp
re
principal amount so redeemed. Such premium however shall
thereafter decline 1/2 of 1% per annum to par.
(3) Should the Bonds convert to a fixed rate
of
interest at any time during the period of December 16, 2000
inclusive, then the Bonds shall not be
2006
r 15
b
,
,
e
to Decem
subject to optional redemption for a period of four
(4)
years from the date upon which the Bonds convert to a Fixed
Rate of Interest. Af ter the expiration of this four
(4)
year no-call period, the Bonds may be redeemed, on
any
Interest Payment Date, in inverse numerical order, upon
the
f
payment of par and accrued interest to the date
t (1%) of
o
the
redemption, plus a premium of one percen
principal amounts so redeemed. Such premium however shall
thereafter decline 1/2 of 18 per annum to par.
A-8
J
(4 ) Should the Bonds convert to a fixed rate of
interest during the period of December 16, 2006 to December
15, 2014, inclusive, then the Bonds may be redeemed on any
Interest Payment Date after the date upon which the Bonds
convert to a Fixed Rate of Interest, in inverse numerical
order, upon the payment of par and accrued interest to the
date of redemption with no premium.
Mandatory Redemption. The
redemption at par pus accrued
redemption, as described below:
Bonds are subject to mandatory
interest thereon to the date of
(1 ) In whole or in part on September 15, 1986 to the
extent funds in the Construction Fund under the Indenture are not
advanced to the Company or reserved to acquire, construct,
develop or equip the Project.
(2) In whole on January 22, 1985 in the event that a
referendum petition has been duly filed pursuant to Section 7.2
of the Charter for the Town of Avon, Colorado (as amended July
10, 1979) protesting the ordinance approving the issuance of the
bonds.
(3) In whole upon foreclosure or acceleration of the
Company Note, on the first Interest Payment Date which is at
least 60 days after such foreclosure or acceleration, provided
that if such foreclosure or acceleration is due to the Company's
failure to complete the Project on the 'Completion Date,
redemption shall be thirty (30) days after such Completion Date.
(4) At -the option of any institution furnishing any
Alternative Security, in whole on any Bond Interest Payment Date
immediately following an-Event of Default under the applicable
agreement between the Company and such institution.
(5) On the first feasible Bond Interest Payment Date,
upon the damage, destruction or condemnation of the Project to
the extent any insurance or condemnation proceeds are not applied
to repair or restore the Project or if the Company determines it
will not be feasible to repair or restore the Project to
operation in an economically viable manner within 12 months after
the damage, destruction or condemnation.
(6) In whole or in part, as applicable, upon the
expiration of the Alternative Security to the extent the
Alternative Security has not been renewed or extended or another
Alternative Security has not been accepted by the Trustee.
(7) In whole in the event of a determination of
taxability which shall be defined as the issuance of a statutory
notice of deficiency by the Internal Revenue Service, or a ruling
of the National office or any District Office,, or a final
decision by any court of competent jurisdiction that interest on
the Bonds is includable in the gross income of the recipient
A-9
! 0
under Section 103 of the
effect at the date of
thereunder for any reaso
is a substantial user o
the Internal Revenue Cod
time and only to the ext
sufficient funds are av
plus accrued interest t
the notice of redemption
t e p p
Internal Revenue Code, as amended, as in
issuance of the Bonds, and regulations
n other than that the Owner of the Bond
r a related person under Section 103 of
e. Such redemption shall occur at such
ent that the Trustee shall determine that
ailable to redeem all the Bonds at par
o the redemption date to be provided in
in connection therein.
Ogtional RedemEti~on. The Bonds are also subject to optional
redemption, in whole or in part, upon the prepayment by the
Company of the Company Note, accompanied by sufficient funds to
effect the redemption in whole or in part on any Bond Interest
Payment Date on or after September 15, 1986 and during any period
in which a floating interest rate is in effect. The Bonds shall
be redeemed in such case at a redemption price equal to 100% of
h rinci al amount of the Bonds.
Rights of redemption of the Bonds shall be exercised by
notice, specifying the Bonds or portions thereof to be called,
the redemption price to be paid, the date fixed for redemption
and the place or places where the amounts due upon such
redemption are payable. Such notice, subject to the provisions
of the Indenture therefor, will be sent by first class mail,
postage prepaid, not less than 30 days prior to the date fixed
for redemption to the Owner of each Bond to be redeemed at the
address shown on the registration books kept by the Trustee.
Reference is made to the Indenture for provisions as to failure
to give, or any defect in, such mailed notice. The Trustee will
not be required to transfer or exchange (i) any Bond during a
period beginning at the opening of fifteen (15) business days
before the day of the mailing of a notice of redemption of Bonds
and ending at the close of business on the date of such mailing,
or (ii) any Bonds so selected for redemption in whole or in part.
if less than all the Bonds are called for redemption at one
time, they shall be called in inverse order of maturity if there
is more than one maturity, and if there is only one maturity or
if the Bonds of a single maturity are to be redeemed, the
selection of such Bonds, or portions thereof in amounts of
$5,000.00 or any integral multiple thereof, to be redeemed shall
be made by lot by the Trustee in such manner as the Trustee may
determine. If Bonds or portions thereof are duly called for
redemption and if on such redemption date moneys for the
redemption thereof, together with interest thereon to the
redemption date moneys for the redemption thereof, together with
interest thereon to the redemption date, shall be held by the
Trustee so as to be available therefor, then from and after such
redemption date such Bonds or portions thereof shall cease to
bear interest, and such Bonds or portions thereof no longer shall
be protected by, and shall not be deemed to be outstanding under,
the Indenture.
A-10
Except as provided in the Indenture, the Bondowners are not ndenture or to
action Ior proceedi g or
entitled to enfor ne or the fendvanyosuit, of
in
institute, appear
to enforce any provisions of the Indenture or to take any action
with respect to any Event of Default under the Indenture.
The Indenture permits certain amendments or supplements to
the Agreement and vamade withtt~hedconsentsof°therTrustee~but
the Bondowners to be
without the consent of or
thnotice to ereto (with the
certain exceptionsthas
amendments or supplements
provided in the Indenture6t bin amade with the ggregate principal consenamountt of
Owners of not less than 6-2/3%
the Bonds at the time outstanding.
If an Event of Default, as defined in the Indenture, shall
occur, the principal of Bonds then outstanding may declared
due and payable in the manner and with the effect provided by the nt of Indenture, but subjeirhin Evehe Indenture.lt or
rescission of such declaration as provided
The Bonds shall not constitute the personal obligation,
either jointly or severally# of the members of the governing body
or any other office of the
This Bond shall not be entitled to any security or benefit any p under the Indenture or certificate become valid or
authentication obligatory hall have been
until the certif certif
signed by the Trustee.
A-1 1
a
•
-B.
F.
J.
&
K.
M E M O R A N D U M
'so: The Persons'on the Attached DA7z December 22, 1984
.Distribution List -
FROM$ Jordan Yarett
Town of Avon, Colorado
$9,500,000 Industrial Development Revenue'Bbnds
(Avon-Beaver Creek Holiday Inn)
Please find enclosed a draft of a Bond Purchase
Agreement and a preliminary official statement for each
of the above-referenced projects.
I will need your final comments on these documents
by Wednesday, December 26, 1984. If you have any questions,
please give me a call at (212) 551-7405.
Enclosures
Issuer:
Distribution List
Developer:
i i
Town of Avon, Colorado
$10,000,000 Industrial Development Revenue Bonds
(Avon-Beaver Creek Holiday Inn)
Bond Counsel:
Town of Avon
Sheila R. Davis (Mayor)
Town Council
Avon Municipal Building
400 Benchmark Road
Avon, Colorado
Roderick R. Brown
Brown Development Co., Inc.- -
c/o Colorado Resort Properties
6455 S. Yosemite
Englewood, Colorado 80111
Office: 303/773-8110
-Home: 303/771-8-703
Erick D. Stowe
Stowe & Herskovits
Chancery Building
1120 Lincoln Street
Suite 1000
Denver, Colorado 80203
303/830-2800
John Dethman
Chancery Building
1120 Lincoln Street
Suite 1006 -
Denver Colorado. 80203
303/861-7511
Investment Banker:
Allen J. Kone
-John A. Sarno
Matthews & Wright, Inc.
14 Wall Street
New York, New York
212/267-4470
Underwriters Counsel:
Trustee:
Trustees Counsel:
Real Estate Financing
Jordan E. Yarett
Hadassah Weiner
"Battle, Fowler, Jaff in, do Kheel
280 Park Avenue
New York, New York 10017
212/551-7405
David C. Montgomery
Murray A. McCollum
Philadelphia National Bank
Corporate Trust Administration
P.O. Box 13834
Philadelphia, PA 19101
Philadelphia: 215/629-4126
New York: 212/966-2230
Bernard M..Althoff
Dwight A. Kinsey
Satterlee do Stephens
277 Park Avenue
'Jew York,_New York
212/826-6200
Jerome J. Steiker
Jerome J. Steiker & Co., Inc.
488 Madison Avenue
Suite 1100
New York, New York 10022
212/752-7313
JAS/Avon
V
Town of Avon Colorado
$10,000,000 Industrial Development Revenue Bonds
' (Avon-Beaver Creek Holiday Inn)
Schedule of Events
11
December 11
-December 13
December 17
December 20
December 27
December 28
-First Reading of Bond Resolution
-Tefra Notice
-Bond Pricing
-Preliminary Official Statement Available
-Second Reading of Bond Resolution
-Pre-closing Denver, Colorado
-Tefra Hearing,.
-Closing New York, New York
JAS/Avon